Buying Phoenix short sales

How long does a short sale take? Part 2

First, read this recent post with an eye-catching visual about how long short sales really take.

For even more commentary about how long short sales take, see the comments in this blog post about short sale processing time on the weblog REO Insider. Most comments written by Realtors, and other industry insiders.

In short, (as of 9/19/2010), over 60% of short sales were taking 6+ months, and more than 80% are taking more than 4 months.

How long do short sales take?

How long do short sales take? There’s no single answer because every bank acts differently when handling a short sale.*

But in general, short sales are not short and they are frequently not even sales. The ballpark amount of time it takes to get the seller’s lender’s approval on a short sale is about 3 months or so, give or take a month.

I like to help my clients envision this by measuring against holidays. “If you’re making short sale offers now – in August 2010 – you should expect to wait until about Thanksgiving 2010 to get an answer from the seller’s lender. If we get a “yes”, then you’ll be closing and moving in around the Chrismukkah.

That’s sobering. So is this chart.

how long does a short sale take

This is a chart taken directly out of the Arizona Regional MLS. The dates are shown in reverse order which is a bit confusing. But essentially what you see (click to embiggen the chart) is that these home sellers accepted a buyer’s offer on their short sale home on May 21, 2010.  Sellers and buyers have been waiting since then for the seller’s lender’s review of the proposed sale.

That’s 3 months of waiting. Not short, in my book.

Homes for Under $25,000 ??

Buy a Valley home for under $25,000?

Sold Since 3 15 09, listed 25k and Under(map courtesy of FlexMLS. Click to enlarge, use browser’s back button to return)

The map above shows the homes (single family detached only) in the greater Phoenix area, with list prices of $25,000 or less, that sold between March 25 and April 25 of this year. Each blue marker is a sold home.

There were 190 of them. One hundred ninety houses that were listed for $25,000 or less sold in the past 30 days!

Only 2% were not lender-owned. Two-thirds of these homes sold above list price.

I thought it might be interesting to see the pattern of homes sold in this price range over the past few months. It was.

December 2008 – 37 homes sold w/ list prices under $25,000
January 2009 – 48 sales
February 2009 – 87 sales
March 2009 – 168 sales

Seems like a pretty clear upward trend. I can hardly wait to see the April month-end numbers.

Meanwhile, at the other end of the price spectrum …


 Listed for 1M or more, 4-25-09 (Map courtesy of FlexMLS. Click to enlarge; use browser's back button to return)

Here’s a map of the homes (again, single family detached only) currently for sale with list prices of $1,000,000 or more. There are 3,107 of them. Only 52 are lender owned. In other words, almost 98% of these homes are not lender owned.

Number sold in past 30 days? One.

In the previous 30 days, 63 homes with a list price of $1M or more were sold. The month before that? Fifty-four sales in this price range.

That’s a microcosm of the Valley’s real estate market this spring. Bank owned homes at the low end of the price range are selling, and fast. The luxury market is dead on it’s feet. Homes in the middle are muddling through. I promise to find and post some stats on the muddling middle very soon.