Selling Your Colorado Springs Home: How to Compete Against Bank Owned Properties
The current Colorado Springs real estate market has more listings and less buyers than we have seen in a long time. Some of the homes for sale in Colorado Springs are Bank Owned. When you are looking to SELL your home in Colorado Springs, and a bank owned property is your competition, you need to know how to effectively compete with it.
What is a Bank Owned (REO) Property?
A Bank Owned (or REO) property means that the former homeowner went all the way through the foreclosure process and the home was foreclosed on and now the bank owns it. Since banks are not in the business of “owning property” these homes are often “fire-sold” for under market value.
Banks usually dump properties for less than market value. In our neighborhood, specifically, we saw a bank-owned property sell for almost $50k less than what comparable homes were selling for. Competing on price, alone, against a Bank Owned property when selling your home can be extremely difficult. However, there are other ways to overcome this hurdle.
How to Compete against a Bank Owned Property:
For as daunting as it may seem, these are one of the easiest types of homes for sale in Colorado Springs to compete against.
- First, the agent co-op is usually closer to 2.5% (Although we are seeing more REO homes in Colorado Springs offering closer to 3% nowadays.) In the current real estate market, many agents are not doing very well. If you can offer a buyer agent co-op of 3% or even higher, I guarantee more agents will go out of their way to sell your home to their buyers. (Remember that home in my neighborhood that I told you about? Regardless of the low price it STILL sat on the market for over a month because of the low co-op.)
- Second, a bank is not likely to budge on terms, nor are they likely to fix any inspection items. (It happens, but it is rare…) Like when competing against a desperate seller, offering incentives like a home warranty and paying for buyer closing costs can make all the difference.
- Third, a bank owned property is a repossessed home. The previous homeowners did not WANT to move, but were forced to move. Most bank owned homes in Colorado Springs are vacant and not in great condition. You can make your Colorado Springs home for sale SHINE, by making sure you have it clean, de-cluttered and professionally staged. Then make sure that your Colorado Springs Realtor® takes a bunch of great pictures for the MLS and other advertising. Many home buyers want a move-in ready home and will almost always choose a perfect home over a cheaper one.