The Worst Bank Owned Property In Fort Lauderdale
July 18, 2008
In an attempt to have asset managers understand the reality of the Fort Lauderdale real estate market, we are going to begin a new series here each Friday “showcasing” the worst bank owned property listing that we can find for that week. Think of it as an REO makeover.
I don’t think I am breaking a story here but in case you did not know, foreclosures have reached near epidemic proportions. Nationally the Fort Lauderdale real estate market ranks near the top..or the bottom of the scale depending upon your perspective, in terms of foreclosures. As one of the “ground zero” areas for the most foreclosures, we are finding that more and more properties once foreclosed are being taken back by the bank.
This means when the Court / Sheriff holds the foreclosure auction, there aren’t any bidders willing to take the property off of the banks hands. So ownership reverts to the bank. Once the bank obtains title they then contact a real estate agent who lists the property on the market.
That’s where the fun begins. You see the agent and bank agree upon a price that they hope to sell the property for. Some are priced correctly, and the bank owned property sells rather quickly. On the other hand some are not and they sit unsold and often badly maintained and consequently they (the agent and bank) go through a series of routine price reductions until somebody wants to buy the property.
I work with many real estate investors and they are the most likely buyers of foreclosures and bank owned property in the Fort Lauderdale real estate market. If the property needs work, they are even more likely to be the buyers.
However most prudent investors know what they are doing. They know that they make their money when they buy, not when they re-sell. Their scrutiny of a deal is rather involved and involves a lot more than a simple CMA performed by a real estate agent. They perform due diligence that includes repair report analysis and a complete regression analysis which is a lot like a 3-dimensional view of the current market. If a property is priced correctly they will pull the trigger. If it’s not, they won’t.
You’re not going to convince an experienced investor into buying a property. Most investors that I work with ignore listing prices as well they should. I see listing prices all the time which, in my opinion, have absolutely no justification.
It makes me wonder what the asset manager and the agent are thinking. An investor needs product in order to survive and profit. Savvy investors are always looking for deals and know what number they need to buy a property at in order for it to make sense.
I spoke to Barry Johnson today. Johnson is an experienced real estate investor and one of the hosts of the popular talk radio program, Real Estate Radio USA.
“When I look at a deal it has to make sense. I can tell very quickly if a bank and their agent are looking to really sell a property or if they are testing the market” said Johnson. He added, “asset managers are not here. They may not know the Fort Lauderdale real estate market. The boots on the ground they have here locally are real estate agents.”
So what is happening is that the banks are relying on agents to price the property and to give them realistic advice on what it’s going to take to move the property. The problem comes in when an agent who is not too knowledgeable about an area or does not take the time to understand the forces he or she is up against in selling a bank owned property.
“I’ve walked into properties that have had dead animals and even dead bodies in them. I have had to call and tell a real estate agent that he has vagrants, crackheads and a lot of other things in some of these properties because the agent never even has visited the property” stated Johnson.
Not believing this was true, I elected to ride around and see a couple of properties. Prior to going out I ran a search on the MLS and found a few properties according to Johnson’s criteria. What happened next amazed me.
We had pulled a property that was listed at $117,000.00. Johnson a few days earlier had just bought a house for $110,000.00 and when I visited the property it was clear he had made a great deal for himself.
When we arrived at the property listed for $117,000.00 I could not believe what I was seeing. I did not want to get out of the car, but I just had to see what “this” was. Using the word house, would not really describe this place. Clearly the listing agent had not seen this property. They say a picture is worth a thousand words so click play on the video below.
(if your browser shows a black preview screen just click play)
Yes, what you are looking at is an illegal addition attempted to be placed on the property (no permit), with black mold all around, a completely wide open structure that has been vandalized with just about every window broken out, a kitchen completely destroyed, and a house basically left for dead after being abused by the former owners and local hooligans.
I hope you can see this property for what is is. It is a complete and utter dump. It is wholly uninhabitable, it is unsecured, it is a health hazard and must be completely renovated from top to bottom. It is obvious that there is a disconnect between the agent and the asset manager.
Hence the winner of this week’s Worst Bank Owned Property Listing! I can’t imagine what we’ll find next week.
If you are interested in learning how to properly assess bank owned properties, or if you are interested in buying a bank owned property in the Fort Lauderdale real estate market or anywhere in South Florida, please fill out the form below and I will get back in touch with you as soon as possible.
You can also search for bank owned properties in the Fort Lauderdale real estate area here.
Here some other posts you may find interesting...
Fort Lauderdale Real Estate
Fort Lauderdale Homes And Condos For Sale
If you are interested in learning more about buying a home or condo in Fort Lauderdale or anywhere in South Florida; or if you need any information about the Fort Lauderdale real estate market, please feel free to contact me and it would be my pleasure to assist you.You can contact me at the number shown below or please feel free to contact me by the form below and I, or one of my assistants, will be sure to get right back to you within a few hours, if not sooner.
If you are inquiring about a specific property shown on this site, please include the address of the property in the comment section of the contact form below.
Bank Owned Properties In Fort Lauderdale
Foreclosures In Fort Lauderdale
Homes Fort Lauderdale
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Robin Sing-Cunningham
robins@robinashley.com
Access USA Realty
Local Fort Lauderdale | South Florida : 954-709-7461
My Assistants:
Barry Johnson: bjohnson@robinashley.com
