Sonoma County REO sale update and agent report

175 Sonoma County REO homes were sold in June. That represents 37% of Sonoma County residentail real estate for the month. 77 of those homes had been on the market for 45 days or less. The clear lesson for buyers is that you have to be ready to move as soon as new properties are listed.

Overbids made up almost half of these fast transactions, but I was surpised to see that almost as many of these transactions were for less than the listing price. I go into more detail on my Sonoma.net blog.

On a related note, I am hearing a lot of comments about agents who underprice their properties in order to generate many overbids and a lot of bidding activity. This has become conventional wisdom, but I didn't know if it was true or not. When in doubt, check the facts is my motto...not really, but it sounds good...so I did an analysis of every agent with two or more REO sold listings during the time frame of this report.

I was surprised at how balanced the vast majority of agents were in terms of underbids and overbids for their properties. Almost all of the well known REO agents in Sonoma County have managed to get almost equal numbers of sold properties at higher than listing and lower than listing values. It reassures me that for the most part, agents are trying to establish fair prices for the properties.

There were a few exceptions to the fair market value pricing of the majority of agents. One agent (who I won't name here) had two listings that sold for an average of $74,000 over listing price. One of his properties was priced at $256,500, less than half its 2005 selling price. It sold for $350,000. Another one of his listings was priced at $329,000 when it sold in 2006 for $560,000. It ended up selling for a $55,000 overbid in 44 days. He's getting offers and ending up at fair market values for his sellers, but he is creating a huge amount of extra work for all the agents and buyers who are submitting list price and above offers that have no realistic chance of being accepted.