Recently, I wrote an article about short sales: The Event of the Century. The article explains how an American Thinker, Michael Calof, acquired a foreclosure property, via low-interest mortgage financing and massive interest-free loans secured by the asset, all at the same time, and for the same price. To do this successfully, he had to create a web site that showed up on Google Image search from all over the world.
Just as I wrote the article, I received an email from a resident of a city looking for short sales in the area. This is very interesting. With only a few short sales that have been advertised in Washington, much less the nation’s capital, the seller of those homes have no ability to control advertising by others.
While I don’t have enough information to make recommendations on whether iBuying is here to stay, I do know that this web site made my thinking on short sales and price-fixing much more complex.
My theory is that the seller of these properties is scared that they might just get a higher price if they try to fix the price. The seller has developed a false sense of power and a false sense of equity by using iBuying. I have more confidence, instead, in buyers being wise and educated buyers who will not get hoodwinked by people with numerous motivations: profit, greed, fear, or ego.
I have seen properties with distressed economic conditions sell at or above the list price. I think I have seen properties at half list price and more. These buyers, though, have much better information than iBuying. They have sought out contacts from buyers’ groups to facilitate the short sale transaction.
Hmmm . . . what would a seller do?
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