Why do short sale properties typically sell for below market value?
Because short sales can take some time to get bank approval and there’s no guarantee that the bank will approve, many buyers either aren’t willing or aren’t able to wait. Also, because many inexperienced real estate agents have been attempting to negotiate short sales for their clients (often with unfavorable results), many buyers and buyer’s agents prefer to avoid short sale properties altogether. This leaves fewer buyers available that can purchase the property, which puts downward pressure on the price that buyers will pay. Also, buyers usually expect a discount in return for the inconvenience of having to wait the extra time for bank approval.
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