FORECLOSURES ARE HAVING A SIGNIFICANT IMPACT on home sales and prices in Myrtle Beach. While “bank owned” homes represent only 2.6% of the current 4800 homes listed for sale, they accounted for nearly 10% of the homes actually sold in September. Some of these foreclosures sold at the lowest prices for comparable properties in recent memory. And there may be more to come.

SHORT SALES OFTEN BECOME FORECLOSURES… and they are appearing more frequently in Myrtle Beach. Short sales that don’t sell eventually become foreclosures. [See my blog: Real Estate Short Sales: Transactions of Last Resort for more information on short sales.]

FORECLOSURES ARE BAD NEWS FOR HOME OWNERS. Foreclosures cause families major stress and hardship, ruin credit ratings, and make financial recovery a long and difficult process. And foreclosures are bad news for the neighbors. They can artificially depress real estate sales and prices of entire neighborhoods.

When will all of this end? Not until most of the foreclosure and short sale inventory is sold. Home prices won’t begin to stabilize until these “bank owned”, or “bank controlled”, properties are finally off the market. And that won’t happen until, at least, the 2nd quarter of 2009. That’s the bad news.

THE GOOD NEWS IS THAT FORECLOSURES PROVIDE GREAT BUYING OPPORTUNITIES for savvy investors… but they won’t last forever. Of the 4800 residential properties currently listed for sale, 2.6% translates into only 125 actual residential foreclosures on the entire Grand Strand. Some of these are bargains, some are not.

WILL BUYING A FORECLOSURE WORK FOR YOU? Here are some things to consider:
• What are you looking for? What are your criteria? If you don’t know what you’re looking for, you won’t recognize it when you see it.
• How will you pay for it? Banks require that “pre-approval” letters, or “proof-of-funds” letters be submitted with all offers.
• How will you inspect the property? Bank properties are sold “as is.” That means that the bank won’t fix anything. Caveat emptor – let the buyer beware.
• Are you prepared to make an offer? Remember, you are not the only person looking for foreclosures in Myrtle Beach. The real deals don’t last long.
• How will you find available foreclosure properties that meet your criteria? That’s where I can help you “separate the wheat from the chaff” and alert you as new foreclosures come on the market.

A WORD TO THE WISE: You make your money in real estate when you buy a property. Savvy investors buy properties at depressed prices… when no one else wants them. Buying a foreclosure is one way to do that.

FOR MORE INFORMATION on buying foreclosures in Myrtle Beach, call me toll-free at 1-888-494-8654, Ext 1, or email me at Barbara.Chartier@Century21.com. I’d be happy to help you.

REAL ESTATE SHORT SALES are occurring more frequently in Myrtle Beach. I’m working with several right now… but nobody much likes them. Short sales are transactions of last resort.

Owners don’t like “short sales” because it means they’ve already lost all their equity, and then some, at current market prices. Lenders don’t like them because they’ll receive less than the loan balance. Buyers don’t like them because they’re dealing with third parties (the lender) and can wait for weeks for answers on offers. And Realtors® don’t like them because they never know how much commission they’ll be paid for negotiating the deal.

So why do a short sale? For owners, it’s better than a foreclosure on their credit history. For lenders, it’s cheaper than the cost of a foreclosure. For buyers, they’re buying property at a deep discount from the previous owner’s purchase price. And for Realtors®, it’s a way to help financially stressed clients sell their property; and it’s a way for financially strong clients to purchase a bargain. But nothing comes easy in a short sale.

So what is a real estate short sale? Here’s a basic definition excerpted from Wikipedia:

A short sale occurs when the proceeds of a real estate sale fall short of the balance owed on the property. In a short sale, the lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank’s loss mitigation department.

The owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the amount owed. In such instances, the lender would have the right to approve or disapprove of a proposed sale.

Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market climate and the individual borrower’s financial situation. Often a bank will choose to allow a short sale if they believe that it will result in a smaller financial loss than foreclosing.

For more information on short sales in general, check out these links:

“How To Do a Short Sale” by Elizabeth Weintraub, About.com

“Is a Short Sale Right for You?” by Christopher Palmeri, businessweek.com

For more information on short sales in Myrtle Beach, call me toll-free at 1-888-494-8654, Ext 1.

WE’RE GOING THROUGH SOME TOUGH TIMES RIGHT NOW.

My head is spinning after the events of the last few weeks. I was just getting used to high gasoline prices and now I’m being asked to wrap my mind around a global economic crisis that has frozen credit markets and caused a precipitous drop in the stock market. If all the experts don’t know what to do, how are you and I expected to figure it all out?

People are starting to realize that what happens in distant financial markets affects them at home. Wall Street and Main Street are intimately entwined. People are worried about their jobs, their declining investments and falling real estate prices. And they have cause. These are tough times for all of us.

But these tough times won’t last forever… they never do.

Most financial advisors tell their clients to think long term when investing in real estate or the stock market… they recommend at least five years. That’s because patience pays off. Historically, investors have made money when they have held on to their investments for five years or more.

My investments in real estate and the stock market are worth less today than they were a year ago. But they are still worth more than they were five years ago. And five years from now, they’ll be worth a lot more. Patience will pay off long term.

These are tough times, but they won’t last forever.

Tough people make it through tough times… and are stronger for it.

The strength of our country is in its people… our faith, character, resourcefulness, ingenuity and hard work.

My parents lived through the scarcity of the Great Depression and World War II and built a prosperous life and legacy that they passed on to their children. And I’m old enough now to have lived through several world conflicts and economic roller coasters. Through them all, my husband and I built a great life and legacy that we passed on to our children as well.

My family is typical of millions of other families across this country. Tough times just make us stronger. We cope, make do, and work ourselves out of our difficulties… confident that a better day is coming.

Some traits of tough people.

Here’s what gets me and my family through tough times:

Faith based thinking - Researchers have linked faith based thinking to health, success, and happiness. You don’t have to be particularly religious, it just makes good sense. Faith based thinking frees you to look for and expect the best every day.

Face your fears – Don’t gloss over your problems, but don’t dwell on them either. Fear paralyzes you; it adds to life’s pain and robs you of life’s joy. Choose to think empowering thoughts that create a positive climate and help you accomplish your goals. Spread some joy and cheer to those around you.

Focus on solutions - Point out what is right, what is working. Choose to think solution oriented thoughts. The choice is always in your hands, hearts and minds. You can choose to make things better and better with the thoughts you think.

Tough times don’t last! Tough people do!

“Can we do it?” “Yes we can!” – Bob the Builder

What’s your opinion of the government’s $700,000,000,000 bailout of the financial markets? Have you ever seen so many zeros in a dollar figure? Probably not, unless you’re a member of Congress. Here’s your chance to express your opinion.

Simply type it in the comment box and I’ll post it within 24 hours. Please keep it PG and pithy.

Here’s what others are saying:

• Barry Goldwater Jr expressed his opinion to Neil Cavuto and ended with this line re: Your dog and your food.

• The National Association of Realtors sent their comments in to The Wall Street Journal: “The Senate’s bold action will help the country emerge from the current credit crisis and put the economy back on its way to improved financial and housing stability.”

• SC Senator Jim DeMint voted against the bailout and made these remarks on the floor of the Senate: “I just do not believe that this bill gets the job done. In fact, in the long term, I am convinced it will do more harm than good.”

• SC Senator Lindsey Graham voted for the bailout and offered these comments: “I remain committed to making sure the root cause of the problem - mortgages being given to people who never should have had them - does not happen again.”

What’s your opinion? Type it into the message box below and I’ll post it within 24 hours.