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Many More Short Sales to Come

Realtor states that short sales make up 50% of his business.

I was having lunch with one of my Realtor referral partners the other day. He was telling me that over 50% of his sales today involve short sales. We started talking about the folks that are selling these homes.

Can you imagine the huge number of people that now have to rent? Can you imagine the number of potential future home buyers? In most cases, they will need to wait 3 years before they will be able to obtain a new mortgage. There are exceptions to this rule.

We could turn the value of real estate around much quicker if some of these regulation were loosened for folks that have gone through a short sale.

This article talks about fraud involved in short sales:

Short Sale Fraud By: Sarah Stoltzfus

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Jim G. October 05, 2012 at 06:54 PM
Ron, I don't know that there's any need to specially address flipping as a separate activity or business. For one thing, any rigid definition would be pretty arbitrary. It always will be a case of 'caveat emptor' - and the beware there is of more than just shady sales tactics. A homebuyer needs to do due diligence on any serious purchase consideration, to make sure they understand, completely and exactly, what they're buying. Being able to spot cheap, hasty renovations that are likely to need replacement or redoing, or work that covers up other problems, or limitations that aren't obvious on a well-dressed walkthrough... any house, any buyer, same demands. That said, CT's RE laws overly favor the seller. There are other models that would protect the buyer more by simply shifting the burden of representation assigned to agents and brokers. My objections to flippers, in the end, have less to do with the details of the transactions and so forth than the lack of investment they have in fostering a quality outcome for the buyer or the neighborhood. I dislike financial hit-and-run artists in any field.
R Eleveld October 05, 2012 at 08:09 PM
You are correct in that the short term traders do not always add in the long term. My industry has a ton of day traders or the 'worse' HFT's or High Frequency Traders. We are agreed that the CT RE laws do need to be modified to be more equitable to the buyers.
Christine October 06, 2012 at 03:39 AM
Hmmmm, I was expecting a discussion on short-sales? Lots of interesting perspectives on flippers-- but I am very concerned with the "future" of short-sales. Currently legislation has been extended through 12/31/12 protecting the seller from having to claim the dollar amount short as income on their tax filings. This is allowing folks to get out from an upside down position w/o getting slammed on their taxes. I have not heard that this has been extended again? If it is not extended, or replaced with new options, short-sales will come to a screaming halt and the foreclosures will skyrocket. Any 411 on this?
Christine October 06, 2012 at 03:58 AM
@Paul Absentee Landlord v. Crime. That's a difficult one. Which came first? The impression of an absentee landlord or the dirt bag tenant? After rehabbing any of those properties, did you ever stick around to be a landlord? All it takes is one rotten tenant to reek havoc on a property and essentially a neighborhood. CT housing law is 100% in favor of tenants. They can sue you over anything, trash your property over and over and over, all the while not paying their rent... and the stupid judges won't just bang the gavel and say "get out." In ten years as a property manager, my shortest legal eviction was 3 months. The longest, 15 months-- in which this particular tenant ended up owing 10k in back rent and caused 25k in damage to the property. Then add in the legal fees and the kicker.... the landlord has to pay for "proper" moving to storage of the evicted tenant's items! That includes moving boxes, bubble wrap for all fragile items, a moving crew, and a marshal to oversee it all. Button that crack-head's professional move up to 3k. Do the math on the cost of that eviction. Many landlords do not have the funds to keep up with such terrible tenants. If you really want to see neighborhoods cleaned up, we need to vote out all the liberal politicians. CT's liberal laws need to be changed to reflect accountability and responsibility, to yield justice for all. We can not continue to humor abusive, destructive, freeloading, non-paying tenants. Period.
jane October 06, 2012 at 09:45 AM
Kevin - absolutely correct. Some folks just don't practice critical thinking.

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