Local Market Perspective: Seattle, Wash.
Over the past three months, my clients and I have presented nine contracts to pre-foreclosure, REO and short sale sellers. Out of those nine contracts, nine have been beat by better offers. In the Northern Seattle area there currently very few REO properties, and in terms of real short sales, I have seen under 10 that are decent over the past month. I wish I had the finesse to illustrate the how important it is to negotiate a Win/Win offer. I can simply say writing a contract for bottom dollars in the hope of catching a whale is only going to bring up a boot. The Seattle market is not what you see on the news, hear on the radio, or read in the paper in terms of the rest of the nation’s foreclosure woes. The money in this town has just shifted from buying retail to buying wholesale, and there are a lot of hungry wallets burning holes for positive equity investments.
Here are some things to keep in mind when investing in the Seattle market:
- Land is an extremely limited resource in this city. Seattle did not experience the “urban sprawl” boom seen in so many other cities plagued with foreclosure woes.
- The Seattle metro area has a strong economic foundation with many companies doing extraordinarily well due to international business.
- Seattle has one of the most highly educated populations in the country.
- Our median household income is about $72,000 annually — among the highest in the country.
- Because of the lack of “urban sprawl” in Seattle we do not have the inventory of foreclosure homes that the rest of the country has. I say this all the time to my buyers, at auction there is a huge crowd competing over six to 10 properties. Even then these homes are being purchased at 20 percent less then market value.
So, if you want to beat the competition when it comes to an equity positive real estate investments do not think cheap, think Win/Win. It makes a transaction so much less of a nightmare, and in a few years you will have built yourself a great real estate portfolio in one of the best cities in the United States.
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