Then…

It was not uncommon to deal with Multiple offers. During the “seller’s market” / “housing boom” years buyers found themselves in bidding wars competing with multiple offers as soon as a new listing hit the real estate market.

Now…

Many Augusta and surrounding areas are fairly stable compared to the rest of the nation.  The difference with Augusta real estate market is you see more foreclosure and pre-foreclosure properties that effect the days on the real estate market of similar listings for sale.  Multiple offers do happen on occasion if it is an “exceptional” or “below market” property.  Retail Priced houses in Augusta can expect 3-9 months on the real estate market – depending on location, condition & price.

Augusta homes are still selling within a few thousand dollars of list price provided the list price is NOT higher than true real estate market value. There is a common misconception that buyers can get homes 10% to 20% below asking price.  I am not saying occasional sellers like that are in the bunch (needle in the hay stack) but it’s not statistically the norm.

Many bank foreclosures are offered BELOW real estate market pricing and they often have multiple offers above asking price.

Then… Rising Prices

I don’t know how, but the sales prices rose month after month in Augusta.  When preparing a real estate market analysis – no prior sales seemed to justify the climbing prices.  After a while I just gave up trying to understand or make logic of it.  I gave my buyers a copy of the active / pending / sold homes so they could see for themselves.  Basically it came down to if the Augusta appraiser came up with that price and the lender was willing to risk loaning money for that price, and the buyer was willing to pay the price, the deal closed.

Now…Augusta Short Sales

More and more Augusta home owners are having difficulties making mortgage payments. Homeowners in default have become an epidemic all across the nation  increasing the need for 3rd party  “LOSS MITIGATION” entities.  They are designed to assist homeowners remain in their house through a “Loan Modification” or determine if selling may be the best or only choice.  Some options lenders offer is “recasting the loan” by adding the back mortgage payments to the end of the loan term and/or temporarily or permanently reducing the interest rate.  Sometimes, they will also reduce the loan balance as well.

“Homeowner Beware” if someone approaches you and requires a fee from you to assist with a loan modification be very cautious.  You are able to negotiate that by yourself by contacting your lender’s “loss mitigation” department.  Do not confuse this with their “collection” department.  The best source of correct contact information, forms and procedures is the lender website.  They often have large departments dedicated to homeowners that are behind in payments.

If a loan modification does not help and you’re struggle making the mortgage payments DON’T WAIT until it is too late.  It is possible to avoid a foreclosure.  Contact an Augusta real estate professional that specializes and has experience  with “Short Sales”.  A short sale will NOT show up as a foreclosure on your credit.  In a short sale, the lender will settle for an amount less then what you actually owe, will pay Realtors fees and often some closing costs.

What are the options for Augusta homeowners if their house is worth less than what they owe and/or they need to sell quickly?  Often, owners have a hard time making the monthly payments or they get transferred from the area leaving the house vacant.

OPTIONS:

1)    Offer your home for Rent
2)    Offer your homes as a lease with “option to buy”
3)    Short Sale

Then… Down Payment Assistance / Special Loan Programs
It was easy to sell homes in Augusta.  Interest rates were low, not as great as now, but they were good.  There was a “respectable inventory of homes”,  with no real shortages.  Down payment assistance and other 100% financing loan programs for buyers were easily obtainable. Stated income loans were available and deals closed with credit scores in the 500′s.

Now…

Interest rates in Augusta are at an all time low, however it has become harder and harder to qualify as the lenders are tightening up the rules continuously.  Near the end of 2008 one of our buyers closed with a 560 credit score. The min. score was then raised to 580 and as of 3/2009 most lenders require a minimum of a 620 score.

Nehemiah & other similar down payment programs, 80/20 and 100% financing loans, & stated income loans are a thing of the past. It went from one extreme to the other. Then loans were too liberal and easy to obtain putting lenders at risk.  Now it is simply too difficult for many to get a loan.  There must be a happy medium.  In my opinion, there are many “low risk” buyers who deserve a loan but are not able to get one because of overly tight guidelines. If lenders are overly restrictive it hurts the entire real estate market and ultimately all of us.  I hope that common sense comes back to the markets and moderation will become the norm.