Why are Scottsdale Real Estate Prices Continuing to Decline?
Increasing numbers of foreclosures contributing to continual slide in Scottsdale real estate prices
Foreclosures, or bank owned properties, keep adding to the number of homes for sale in Scottsdale and the surrounding area. This continual supply of homes along with many lenders willing to sell their inventory for less than market value keeps pushing prices down.
Why do homes end up in foreclosure? What is the process that concludes with the bank taking ownership of a home?
Before a Scottsdale property becomes a bank owned property, it goes through a trustee sale process.
Once the beneficiary records the Notice of Trustee Sale with the respective county recorder’s office, the trustor/owner of the property has a minimum of 91 days before the property goes to the trustee auction. If the trustor/owner brings all of their payments current and up-to-date and pays any penalties before the auction date, the trustee sale process is cancelled.
At an auction, the starting bid or credit bid is normally the amount the lender is owed on the property. Unfortunately, the starting bid is more than what the property is worth much of the time. For this reason, it is rare a third party would bid on the home so the property ends up going back to the lender. The property is now what we refer to as a bank owned property.
Predicting Scottsdale Real Estate Price Trends
The number of Notice of Trustee Sales in an area is a good indication of which direction future home prices may go. As a general rule, if you have ten properties in a subdivision with a Notice of Trustee Sale recorded against the property, six of these properties will likely go back to the bank (assuming Maricopa County, Arizona has a 60% foreclosure rate once a property undergoes a Notice of Trustee Sale).
These properties will probably go back on the market at a reduced price, or what’s known as foreclosure, bank owned or REO. When these properties sell, their sales prices generally become the new market value for the subdivision.
Want to learn more about Scottsdale real estate prices and how much you should buy/sell your home for? Contact Scottsdale real estate agent Mark Mashal today for a no-risk consultation.
Expert Scottsdale Realtor
Mark Mashal's service expertise included Single Family New Homes, Resale Homes, Patio Homes, Townhomes, Condos. Mark has helped in the Relocation of real estate for individuals all over the world in the past 7 years. Additionally Mark has helped first time home buyers in negotiating their first dream home!
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