Connecticut Submission Steve Briotti

	Steve Briotti
	Stephen Briotti Regional President, CENTURY 21 Access America Web: www.steve21.com/	Tweet

Even in these unprecedented times, certain real estate principles will always apply. Real estate will always be looked upon as a long term valuable asset. That is the reason why lenders offer 30 year mortgages. At the current population growth and the current rate of construction of new housing, there will be a housing shortage by 2025. When there is a housing shortage it is a seller’s market.

As of January 2011 it is now more expensive to rent than to buy in 72 % of major metropolitan areas across the US due to rising demand for rents and falling home prices along with low mortgage rates, according to the Trulia Rent vs. Buy Index. It is truly a buyer’s market. With that in mind, most good deals are made between well informed buyers and either uninformed sellers in desperate straits or motivated sellers with a compelling need to sell.

Connecticut has a diverse array of living styles and prices ranges, from Fairfield County, also known as the Gold coast, to the metropolitan areas of Hartford, New Haven, and Waterbury to the waterfront homes of the shoreline. Connecticut also is a no title company state. Transfers of title are accomplished through attorneys who close for buyers and sellers. The level of attorney involvement in the buying process is different in many areas of the state, mostly governed by custom. Many towns have a custom of having attorneys involved once the real estate contract is signed by the parties and prepared by Realtors who fill in the terms and conditions. Other towns have the custom of attorney review within 3 days of signing of the agreement. In many towns in Fairfield County, attorneys handle all the contracts and addendums from the time of offer, through the negotiation period, right up to the closing. As a matter of fact, some Realtors just notify the attorneys of a verbal agreement between the parties, then the attorneys handle all other negotiations and contracts until closing. No matter what customs a certain town may have, uncommon deals can be found in every town or type of home living style since there has been a 40-50 % drop in values since 2006.

In a time of record foreclosures and short sales, supposed good deals could be found everywhere. However, many REO (real estate owned by lenders) properties are listed at prices that would attract buyers. Many foreclosures need so much work, the average owner occupant buyer would not be able to obtain a mortgage from a lender. As a matter of fact, cash buyers have a big advantage because they’re only competing with one another. Many of these homes are then remodeled to mortgage ready status and sold to the typical home buyer at a profit for the remodeler. “Short sales” or homes for sale that are worth only a fraction of what is homeowner owes. Many holders of these mortgages will take less for the home in order to save the time and the expense of foreclosing. Many take a promissory note from the seller for the difference of the amount owed and the actual net.. Many lenders are regulated in the short sale process not to accept less than 90-95% of the last appraisal value. It must in the best interest of the lender to take less rather than to foreclose. So you see at first glance, foreclosure sales and short sales can be viewed as “good deals” but typically they are sold within 10% of what they are worth.

A trained agent can better identify good values than the buyer by having instantaneous access to properties listed through the Multiple Listing Service and the ability to search the history of a particular listing. Also Short Sale specialists can convince certain lenders to take much less than the appraised value by establishing a history of the property not selling and by providing the lender with market information that would lead the lender to believe it would be in its best interest to take the offer than to foreclose.

Once a property is foreclosed, it is usually vacated, secured, cleaned out and winterized. Often the property has been vacated for some time and falls victim to lack of maintenance and/or vandalism. Buyers of foreclosures must be especially wary of unforeseen repairs since most foreclosures are sold in as-is condition with no property condition disclosures. Many lenders require the buyer to purchase the property with no mortgage contingency, nor offer any type of warranty. Sometimes clear title isn’t guaranteed, as is evidenced by the recent suspension of foreclosure sales by some of the country’s largest lenders.
Some foreclosures that do not sell on the open market go to auction to be sold to the highest bidder. Although the sales prices might be low, let the buyer beware since most auction companies add a premium to the sales price. Although these companies allow access to the premises to prospective bidders, a detailed property inspection cannot be made, as utilities to the property are commonly shut off. However, many great buys can be found at auctions because the lender is already convinced that this particular property cannot be sold by conventional means.

Therefore, some short sales and foreclosures can be identified as an “uncommon deal” but most often with the help of a trained professional that can give the buyer the insight to determine what is a good deal and what is not.

Another source for buyers trying to find a good value, is properties for sale that are estate sales subject to probate court approval. Often executors of these estates are anxious to sell as the burden of maintaining the property falls on them. In most cases, the greater the burden is, the higher the motivation becomes to sell. An agent with access to MLS can find these easy enough because the remarks section should include wording that states that this sale is contingent upon probate court approval. Once again, the use of a trained professional can help any qualified buyer find a good value.

Once a potential good value is found, the negotiation process determines whether it becomes a good deal or a great deal. An agent is often needed as a buffer between the buyer and seller to ensure that offers aren’t viewed as insults but rather as starting points. Realtors, being on the front lines of real estate, have the ability to identify valuation trends before many buyers, sellers or even appraisers can. Knowledge of where the Connecticut market is heading can be the most useful tool in finding an uncommon deal.