Disposition Value Form

[J Grant]

Res Guy, your long explanation about the "motivations" behind REO sales is reaching for a reason not to use them. REO sellers have the most straightforward motivation there is, sell the property. It's that simple. Nothing mysterious lurks behind it The bank lists the REO owned property with an agent on MLS. Hmmm....what could their motivation possibly be? To sell the property, perhaps? Whereas private sellers have a far wider range of motivations, which leads to them taking a house on and off the market, listing at crazy prices, rejecting reasonable offers and all kind of other behavior. All of which is considered "typical" when it is part of predominant sectors of activity.

 

[residentialguy]

REO sellers have the most straightforward motivation there is, sell the property. It's that simple.

That is the biggest pile of Bullsheit I've ever seen posted by you. Motivations varied widely!!! Every one that puts up their property wants to sell the property - duh! Question is, how dire is the need? Sometimes they have to get rid of it quickly. Are they going broke because of all the properties they own? Have they been funneling money into that house for months? Years? Sometimes they're going by bad pricing information. Banks foreclose on property to recover a debt owed them by the property owner. The amount of that debt is the bottom line that banks need to recoup...unlike traditional homeowners, they can't make a profit.

Motivation: to sell the property, lol. Yeah, tell that to the state board. They'd love the laugh

Res Guy, your long explanation about the "motivations" behind REO sales is reaching for a reason not to use them.

No, these are not made up. You ignoring them is biased.

 

[residentialguy]

If the only filter is REO sales vs non REO sales, prices will be all over the place.

Similar models in similar conditions will have prices all over the place.

 

[J Grant]

That may be true in your market, not true in my market, making it easy to eliminate REO outliers, as I would any other outier

 

[residentialguy]

That may be true in your market, not true in my market, making it easy to eliminate REO outliers, as I would any other outier

REO prices in FL are tight grouped as owner occupied? More BS.

 

[J Grant]

how funny you comment on FL from Minnesota...and I would not even comment on all of Florida either! , I will comment on my county areas I cover, and in case you missed it, I post repeatedly that each appraisal and market area is different (regarding REO's or anything else happening in the market ). SOME REO prices in SOME areas and property types are similar to owner occupied sales. Certainly not all by any means and I never posted that they were. I posted that prices are not "all over the place", the prices can be seen to relate to condition, supply, demand etc (probably true of your area as well)

 

[residentialguy]

REO are often spread in price for no rhyme or reason. This is not a locational thing. Are you trying to tell me that BofA, FNMA, HUD, etc get together and decided to tighten the REO sales variances in your county?

 

[J Grant]

I have no idea of what is going on in your area. In my area, and talking with a good appraiser friend in another part of the country, prices of REO's (those sold on open market/MLS) tend to be within a range of consistency relatrive to their condition, property type and market area.

You seem to lump REO's into one generic category and I have no idea if you are separating out how they are sold, their physical condition, or anything else about them when commenting on prices being all over the place. But if that is true in your area, then it is.

REO's of a certain property type , and condition, located in a specific market area compete with other REO's ( and non REO's). It is usually from analysis their prices are not "all over the place" when sold on the open market. Though prices of REO's can vary widely, typically it is found their prices relate to a individual property's condition and location , market competition etc.

 

[residentialguy]

I'm talking about variances in prices comparing similar properties of non-distressed owner occupied sales vs variances in prices comparing similar properties of REO sales. The REOs will have a greater range of prices.

 

[J Grant]

I find the opposite, owner sales have a large variance for similar in some cases. Never one generic one size fits all where I appraise