Good day everyone, while pulling the data for Bridgeport within Valencia California – which is within the Santa Clarita Valley, which is part of the Greater Los Angeles area (I’m going to stop, but could go on and on 🙂 ) – I found a single listing which has a Notice of Default filed on it and is currently for sale as a Short Sale.
Just to remind you or explain to you if you don’t know – a Short Sale is a property listing where the seller does not have enough equity to sell it where the bank who owns the mortgage will be able to break even. They also do not have the funds necessary to make up the difference between what they owe to the bank and the value of the home.
Equity is not necessary to sell real estate
A real estate seller does not have to have equity to sell a home. In fact, they can make up the difference between what they owe and how much they are able to sell their home for with their mortgage holder. We have had some home seller that have done this and did not embark on the short sale journey.
However, for 99.9% of those who need to sell a home, who are upside down on the mortgage, a short sale is their chosen path.
Short Sales happen and if you are going to go down that road, make sure you call me so I can guide you through the process and put you into touch with key vendors who you will need to speak with before finalizing your decision to short sale your home.
As the Universe would have it, I received a phone call from a Bridgeport resident. He heard a “rumor” of a Bridgeport home being listed for way under market value. He actually had the address and had “found” the listing on our SCVnest.com site.
I called him back quickly and informed him that listing was short sale and the listing reflected it having a notice of default NOD filed on it.
The following information pertains to other types of distressed listings as well – Foreclosures, Bank Owned properties and Real Estate Owned REO listings.
He wanted to know if this home, when it sells, will hurt the value on his block and within his neighborhood?
Market Trends Matter
That question is market trend dependent. As I studied the past 30 days, I researched 9 homes listed for sale in his neighborhood, Bridgeport. Another three homes are currently under contract, in escrow where the seller’s want additional showings and additional offers written for backup (just in case) purposes. There are 4 real estate listings that are in the “pending” status and which are on their ways for a solid close. For more intel about Real Estate statuses I wrote this article.
Example of market trend research and data
During the past year, the last 365 days, 59 real estate listings have sold in Bridgeport within Valencia. Of all of those homes, only two have sold which were distressed. Both of those listings, in the past year, closed in Bridgeport and were both in of the same sale type. Both were REO/AUC – Real Estate Owned homes which sold at Auction.
To answer the Bridgeport resident’s question – With the current market statistics – the one short sale which has been listed for less than fair market value, which is being sold as a short sale, will not harm the property values in Bridgeport. It will also not hurt his own property value in the same neighborhood.
Banks don’t lose money
OMT – the banks, the one which owns the mortgage on the home being sold short, is not going to allow this home to sell for less than Fair market value – FMV. The banks are not in the business of losing money. Even if the home gets an offer for the listing price, which is about 100k less than Fair market value, the bank will counter and require a higher offer after they have the home appraised.
Thanks for reading my posting about if a Distressed home listed for sale hurts neighborhood property values. I’m Connor with HONOR and reach out to me when you are ready for me to be your real estate consultant and guide through the real estate process in the Santa Clarita Valley Cities and Elsewhere in the Greater Los Angeles Areas.