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Bank-Owned Property

A triplex, the housing boom, and foreclosure twice

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While appraising a triplex in Sacramento I came across an interesting property history of another nearby triplex in the “Gardenland” area of Sacramento in the 95833 zip code. As you can see below, this property has changed hands quite a bit in the past five years, and it has gone into foreclosure twice too. This is actually a fairly common phenomenon because investors and first-time buyers purchased properties several years ago when property values had already come down since 2005, but then the economy took a turn for the worse. Property values decreased even more and unemployment increased dramatically also.

Sales History of a Triplex Property:

10/01/2010  $117,500 (sold on MLS as bank-owned)
08/11/2010  $60,376 (foreclosure transfer)
02/28/2008  $180,000 (sold on MLS as bank-owned)
07/25/2007  $306,000 (foreclosure transfer)
06/22/2006  $399,000 (sale – not on MLS)
05/27/2005  $360,000 (sale – not on MLS)

It’s remarkable to think this triplex once sold at $399,000 and yet closed days ago for $117,500. This property seems to tell the story of the housing bust and current economy, huh? What do you see?

Transformation from an ugly cinder block house to a remodeled Sacramento beauty

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I made this one-minute “before & after” video for a client (Housing Group Fund) to help show one of their recent first-time home buyer projects in Sacramento. I appraised this property and I have permission to post the information here. This is a block  construction house (cinder block) near the Fruitridge area that was purchased recently as a bank-owned fixer and then rehabbed extensively throughout. One of the features I really like about this remodel is that there is now sheetrock and texture on the interior walls so the house does not have a typical “block” feel to it. If you are reading in RSS, you can view the video directly here.

It’s amazing to see the difference from beginning to end. What do you think? 

The Psychology of Stripping an REO Property in Sacramento

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No, this is not a storage container, but a stripped AC unit on a bank-owned multi-unit property in Sacramento. Why do you think REO properties are such easy targets for theft? I gave some thoughts to this a few days back in an audio post. Obviously the properties are vacant, so it makes it easier to give the “five finger discount”, but is there something more sociological to consider here. Is it deemed more “acceptable” to take things that belong to a faceless bank as opposed to an actual person? Your insight and thoughts are welcome in comments below.

Built-in Microwaves & Foreclosure

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Is this still considered a built-in microwave? It’s a marketing feature too, right? Just be careful when taking out your Lean Cuisine or Hot Pockets because they might slide out to splatter you.

There is often a stigma for properties that are listed as “foreclosures”, so it’s no wonder that bank-owned homes tend to sell for less than regular non-distressed transactions. However, consider too that many times REO properties need things like interior paint, carpet, and even new microwaves (and kitchen repairs) like this Sacramento area house. So foreclosures will sell for less than typical arms-length transactions in many cases, but not just because of the REO stigma, but due to obvious condition issues.