Strictly Business? or Emotions?

Conventional wisdom says offers should be viewed as strictly business, and not taken emotionally. And so it should be...but quite often, conventional wisdom gives way to human nature. Case in point: Lake Oconee is roughly a 50/50 second home vs. permanent home market. While there are certainly a fair share of short sale, foreclosure, and "motivated seller" properties on the market, perhaps 80% of the homes and lots for sale in the lakefront and golf communities are owned by people who are not desperate. They want to sell, certainly, and many have adjusted their prices downward to reflect the market, but they are in the same boat as buyers of second or vacation homes...neither party MUST sell or MUST buy. So...

If the goal is to buy property strictly as an investment, it's definitely a buyers' market, so offers at 50-60 cents on the dollar are fine...if the seller gets offended, so be it...the buyer has nothing to lose.

But if the goal is to find a property intended to serve as a gathering place for family, friends, or business entertainment, a really "lowball" offer can stiffen even a motivated seller's resolve to either not counter, or to counter at near asking price. Negotiations in this market can be long, drawn out, and intricate. The process leading up to closing can often present situations where one side or the other needs a little "goodwill" from the other to keep things moving. Whether representing the buyer or the seller, (and I'll only do one or the other), bad harmonics created during the process of making an offer can derail the purchase down the road. Good harmonics, preserved with some thought, foresight, and perhaps a little wit, can result in a closing that leaves both buyer and seller satisfied with the overall outcome.

Lake Oconee and Lake Sinclair distressed properties, short sales, foreclosures

While the national downturn in financial markets, including real estate, has not affected the local market for lake property at Lake Oconee and Lake Sinclair as severely as in traditional residential markets, there are still opportunities available.

First, a general observation: although the local newspapers are carrying pages of impending foreclosure sale notices, very few really desirable lake properties actually get sold on the courthouse steps. The bank intervenes with an offer of a potential short sale (they will take less than their borrower owes and release the borrower from further responsibility). Or the borrower finds a buyer for the property in the nick of time, often by getting realistic about the property's current, true market value.

A "courthouse steps" transaction has so many potential pitfalls...being sold "as is", possible tax liabilities, possible mechanics' liens...that you as a buyer, and your agent, had better be very specifically experienced in such transactions. Also, lenders will often refuse to sell at an absurdly low price. They have no desire to get stuck with property to manage, but they are generally unwilling to let a property go at 20% or 50% of it's current market value. Very few agents have the experience to properly represent their buyer (I don't...that's why I steer clear of these transactions. A handful of our area agents are quite well qualified to do this and are earning a good living at it). It is truly not an activity for the faint-hearted, uninitiated, nor for the average seeker of a place for their family to live or as a family retreat.


What does make sense, especially for the buyer who wants property for their own use rather than as a pure investment, is to spend the time to get to know the relative values of properties available, and to get a feeling for the degree of motivation of specific sellers. For the buyer who has the financing arranged, or better yet, the cash on hand, to make a buying decision quickly, there are excellent buys...values that would have been on the mark four years ago, and and with good potential to maintain or increase in value.

And just try taking your granddaughter fishing at your 401K!

Lake Oconee lake front home short sale

The short sale closed yesterday. Purchase price of $250K...an extremely good buy for a lakefront home even in this market. Today, tracking down the owner of a specific $1M+ unlisted lake home for a potential buyer.

Lake Oconee short sales of lake property

My first "short sale" is closing on Monday. The buyer is getting a wonderful lakefront retreat for a bargain price (I can reveal it Monday) and the sellers are getting out of a tight market with their credit intact. And the mortgage company is avoiding owning a property in an area with which they are unfamiliar. I'm showing one tomorrow that is a spectacular, large home in one of our top golf communities. Asking price in the mid $600's, but the bank will have to approve the sale. Thankfully, as a primarily second home market, we aren't overcome with distress sales, but there are a few available. More to the point, sellers are either getting realistic about their property's value, or just taking it off market to wait for better times.