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I can remember during the last great real estate bust in the early 90s, I went to a real estate expo at an arena in New Jersey. Banks had set up booths were they were trying to sell their foreclosed properties. Publishing companies sold big books of bank-owned property listings for hundreds of dollars. They were out of date as soon as they were printed. The Internet has changed all that.
Check out this site. It was created by a Boston-area programmer who wants to remain anonymous. You can use it to find foreclosed properties, what banks and mortgage companies call their REO or real estate owned. It links to the Web sites of eleven big lenders. And it’s free, unlike some other sites that sell subscriptions so you can search for foreclosure listings.
The numbers are staggering. Countrywide has taken back 15,500 properties, with current asking prices of $3.1 billion.
Scouring these lists isn’t a total breeze. Although you can quickly narrow your search down to a particular state at Countrywide’s site, you still have to scroll through pages and pages of listings until you find the particular city you are interested in. Also, there are no pictures of the properties or links to where they are on maps. Sites at other lenders vary. At Citibank you can search by city, but there are also no pictures. Bank of America and IndyMac have pictures.
Of course once you find a property you still have to negotiate a price with the bank. The creator of this REO site says he bought a bank owned property in suburban Boston last year for about 25% less than what the previous owner had paid. If you’ve got a story about purchasing or trying to purchase bank-owned property, shoot us an email. Maybe we can all learn something.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.