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Fannie Mae Short Sales – A disaster in process! The best advice to buyers is to understand the market and don’t assume that a Fannie Mae foreclosure means bargain pricing. The other strategy is to steadily reduce the inflated list price until buyers find it attractive, thus convincing Fannie Mae that they received the highest possible price and compensates for increased carrying costs such as taxes, HOA dues, utilities and maintenance.
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A cash offer would have the same benefit, no appraisal. With low inventory, FHMA is hoping that a buyer with financing will offer the higher price and use Homepath financing which does not require an appraisal.
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There can only be two reasons for this direction. In January 2012, Fannie Mae properties were listed 10% over the eventual sales price. It appears that their strategy changed from the previous year. Don’t assume that it is priced below marketĪn analysis of Fannie Mae foreclosures or REO properties that closed in January 2013 for Mesa, Gilbert, Chandler and Tempe revealed that Fannie Mae foreclosures were initally priced 20% over the eventual sales price. The prudent buyer will recognize this and wait. In the current market, Fannie Mae foreclosures are initially listed over market value. Many buyers are willing to accept these risks if the price is right. There are no disclosures, the property has been vacant, neglected and possibly mistreated by the previous owner. Don’t expect logic or common sense to found anywhere in the transaction.įannie Mae REO’s – Foreclosures – Not a bargain at firstįoreclosure properties have become synonomous with value if the buyer is willing to overlook certain deficiencies. You could wait months and then be asked to pay market value or higher. If it is a short sale and Fannie Mae holds the lien, you should seriously question submitting an offer. If the foreclosure is a Fannie Mae owned property, be patient. When you see a short sale or foreclosure, do you think a bargain is coming your way? My advice: slow down and see who owns the note on the property. Follow him on Twitter at /markpuente.Are Fannie Mae Short Sales and Foreclosures A Bargain? Mark Puente can be reached at or (727) 893-8459. "They show better and get more buyer attention," he said. He said the foreclosed homes that are repaired will help bolster the housing market. Kyle Klemmick of Florida REO Group in Palm Harbor has been selling Fannie homes for two years and has listings for 20 to 30 at a time. "We are trying to stop the circles of foreclosure," Murphy said "We want to attract people, not repel people." He said the agency does not expect a dollar-for-dollar return on the repairs since the goal is to make them livable for owner occupants. Rick Murphy, director of Fannie Mae's foreclosed homes in Florida and Georgia, said properties needing extensive fixes likely will still be sold to investors, who will make repairs and then rent the homes.Īlthough those purchases move the foreclosed homes off Fannie's books, it does not stabilize neighborhood values since investors will hold the properties until the housing market improves, he added. Prices range from about $30,000 to more than $300,000. That shuts out many individual buyers who depend on government-backed mortgages.īut Fannie Mae is wooing owner occupants, hoping to promote homeownership and neighborhood revitalization.Īs of Wednesday, Fannie Mae had 509 homes for sale in Citrus, Hernando, Hillsborough, Pasco and Pinellas counties. In housing markets saddled with lots of foreclosed properties, investors buy most homes because banks will not make repairs. Most of the houses are in states hit hardest by foreclosures, including California, Nevada, Arizona and Florida. Banks foreclosed on the properties and then collected on the insurance from Fannie Mae, giving ownership to the agency. It looks like they are stepping up the pace."Īt the end of June, Fannie Mae owned 136,000 homes in the United States as a result of buyers defaulting on insured mortgages. "It's nice when a client walks in and realizes they don't have to do much," said Rae Catanese of Tropical Prudential Realty in South Tampa. The repairs are bringing in more first-time buyers in the Tampa Bay area, since the houses are move-in ready, real estate agents say. Those costs topped more than $400 million last year. It lumps the figure into other foreclosure costs, like taxes and fees. It also does not track how many taxpayer dollars it spends on fixing foreclosed homes. Fannie Mae repaired more than 87,000 homes nationwide last year.