Phil Sharp

In a previous post I discuss Tours of Foreclosure Properties in the Olympia and Lacey Wa area. The following is general information about foreclosures in general and about properties on the tour.

Foreclosures:

People use the word foreclosure very loosely in this business. The real definition of a foreclosure is a property that has been taken back by a lender because of non-payment. The property is owned by the bank, and is typically listed for sale with a local realtor at fair market value. The bank or lender is most certainly a motivated seller, but you have to keep in mind their bottom line. (and remember that the bank is operating as a business, without too much emotional baggage.) Bank Owned properties, or REO's, can generally be purchased at slightly below full market value.

Short Sales:

A short sale refers to the sale of a property before foreclosure. The home owner is in trouble, recognizes that they are in trouble, and are trying to negotiate a sale that will get them out of the property without too much of a black mark on their credit report. In a short sale situation, the lender has agreed to a sale, usually at a loss, and has approval authority over any offers. Purchasing a home as a short sale is usually where you will find the best deals. There is some urgency on the part of the homeowner and lender to "stop the bleeding".

Default properties (Pre-foreclosure):

A property in default is a prime candidate for a short sale. Sadly, many home owners refuse to acknowledge or accept that they will loose their home, and take no action. A home owner is considered to be in default once they become 30 past due on a payment, and the mortgage lender typically starts legal action (by serving a notice of default) when the payment is 60-90 days past due. Default properties are good to watch (and I keep a data base of every home in default in Thurston County), for obvious reasons. A strategy found in many real estate investment books is to approach properties owners in default and attempt to negotiate a sale (a technique I call a "cold short sale"). When working this technique, be aware of what you are competing with. The homeowner is being hounded by bill collectors, receiving calls, mail and email promising solutions, and is also being called by every realtor in town asking to list the property. Needless to say, these people are gun-shy, and are in denial about their situation...or they would have listed and tried to sell the home themselves.

Real Estate owned by banks and lenders (REO's):

Following Short sale, Real estate owned (REO) property is the best source of financially distressed properties. As I said before, the bank is operating following a business plan, or model, that clearly spells out how they will deal with foreclosed properties. They of course want to get as much as possible for the property (they will almost inevitably loose money, but they try to limit the loss), and they will hire a local real estate agent knowledgeable of the market and able to protect their interests.

The bank will try to get as much as they can for properties they own, only makes sense. But they also consider holding costs, taxes, insurance, and other expenses when deciding how to price a home, and in the offer that they ultimately accept. A good way to look at it (and you should look at your own investments the same way) is that every month that you hold a property, the price should go up by the amount of holding costs. Conversely, a price decrease now may make sense rather that taking a month to month loss waiting for a higher price....it's all in the numbers.

All of the homes on the tour are listed on the MLS, and are either short sales or bank owned. If you are interested in making an offer on any of these properties, or if you would like to visit properties that more closely fit your needs, please contact me at the number below. The properties on the tour are a cross section of what is currently available. I have avoided severely distressed properties and properties with less than enthusiastic sellers. We will visit 8-12 homes of over a hundred that are short sales or REO's...in other words please call if you would like to scratch deeper; today we are just scratching the surface.

If you would like to participate in one of our weekend tours, or if you would prefer a one on one tour of homes that are specific to your needs, please visit Olympia-HomesOnline, or email Phil at Phil@PhilSharpHomes.com. You can also RSVP by calling 360-455-1366. The tour has been consistently booked about a week in advance so please RSVP as soon as possible.

Phil Sharp Homes has been conducting tours of foreclosure and short sale properties in the Olympia and Lacey Wa area since mid-March. A recent article in the Olympian Newspaper highlighted the first tour open to the public, and highlighted the situation of "Mr. June". Mr. June is a homeowner facing loss of his home due to his son's medical expences. Mr. June attributes the fact that his home is now under contract...and that he will not be faced with foreclosure, to the tour.

Of the twelve homes featured on the first tour on the 29th of March, six are now pending sale. These homes are not pending because of the tours, rather they are selling because buyers who have been on the fence are seeing real value in the market. The prevalent sentiment among buyers, at least in the local market, is that the worst is over. Lots of inventory is the downside; strong local economy, #8 in Forbes list of the top ten places to invest in real estate, and geographic location are the upside.

The following is a press realease from the Olympian Published on March 8th, 2008. Please use the contact information below if you would like to participate in a future tour.

Join Phil Sharp of Abbey Real Estate for a tour of short sale and bank owned properties, with the first tour on Saturday, March 29^th, with other weekend tours throughout the month of April. Please RSVP with Phil at 360-970-9977, or visit http://www.olympia-homesonline/.com for more info.

Commuting in and Around Fort Lewis Wa

When PCS'ing to a new installation, my first concern was always the commute. Arriving at work before first light, multiple trips back and forth to post, and being close to the unit for recalls and trips to the barracks is a big consideration and has a huge impact on quality time versus travel time.

Fort Lewis straddles Interstate 5 just south of Tacoma and North of Olympia Washington. The portion of the installation that is south and east of the freeway is considered as main post, to the north and west of the freeway is north fort. The installation headquarters, main PX, Madigan AMC and numerous other troop units occupy main post. North fort is well known by ROTC Cadets; the barracks used for ROTC until recently were wooden "WW II" barracks located on north Fort Lewis. In the past five years, many new barracks and unit area construction projects have been completed, and others are underway.

When I moved to Fort Lewis, friends and associates who had been stationed here before recommended that I look for housing to the south, in the Lacey or Olympia area. The biggest quantifiable reason I was given was the commute. Traffic from Thurston County is significantly less than that from Pierce county and Tacoma. Additionally, many people feel that crime is less of an issue in Thurston County, which is much more rural that Pierce.

Another area that has become very popular, especially for those who will be working on main post, is Yelm and Roy. Located several miles from the back or "East" gate, Roy (in Pierce County) and Yelm (just south of the Thurston County line) are very convenient commutes. Although both are small agricultural communities, Yelm is the fastest growing small town in the state; primarily because prices are somewhat lower than those in the larger towns on the freeway. If you think you will be working on north fort, Yelm and Roy may not be very good choices; the only route is across main post, and under the freeway at one of two points...always a traffic jam.

To the north are the Pierce County communities. Lakewood is almost right outside of the gate, just a short distance north on the freeway. Not a bad commute, with traffic concerns only during rush hour. Further north is Tacoma, Graham, Puyallup and other small communities and neighborhoods. If you are into being in or near a large city you will most likely want to go north.

For more information about the Fort Lewis area and outlying communities, please visit my website; Fort Lewis Agent.com

Phil Sharp; Retired Army, with thanks to those still serving

I wanted to update you on what I learned today.

28% of Listed Homes...Priced under $240K...Are Under Contract; Almost All Within The Last Two Weeks!!

I have seen more properties that are "Subject to Inspection", meaning under contract, in the last ten days than I have since the summer of 2005. This prompted me to come back to the office and do some research. According to my search on the MLS, there are 132 listings in the Lacey and Hawks Prairie areas priced under $240,000. Of those 132 lsitings, 48 are either subject to inspection or pending sale (under contract). Thats 28% of the listed inventory...

Real Estate is ON Sale, Interest Rates are Great, and those who are paying attention are finding some great bargains.

If you have been waiting to "See what will happen" in the market, as many of us have been, we are seeing something happen!! People are realizing that Real Estate is a great bargain, it is a buyers market, and interest rates can't get much better (although Bernake has made rumblings of another rate cut soon...more good news!!).

I am sure you know that I am not an advocate of timing the market, I believe in buying value when you see it. We have some great values out there. The numbers above tell me that something significant is happening; low interest rates, good value, and pent up demand are the catalist. All of these facts are quantifiable indicators that there is movement in the market; increased sales volume can only mean one thing, and that one thing is positive.

I would love to sit down with you in front of the MLS and find the home you've been looking for...At a Fire Sale Price! If you would like to learn more please visit me at Phil Sharp Online.