A few rumors let me known a new wave of default as High End Luxurious properties due to lack of loan modification and loss of value. Already a few as bank owned, and I have received more BPO order lately regarding this kind of property. Often property valued from $ 1.5 and up to 25 Millions on my experience.Millions Dollars BPO still brings $ 50 fees. But there are a few concerns. One of them is a challenge to find comparable as the subject property is unique. 10,000 sq/ft GLA in the best area of San Francisco with views is not easy to find comparable as you can do with the local subdivision from the 70's. Five acres with main structure, guest house, staff house, beach house, private beach with boat dock and two pools represents a guaranteed challenge to find comparable and to get a fair value.Many BPO website have the question of fireplace with YES/NO choice. What about when there are six of them.Other concern is who will buy them when a bunch of them will be REO. I believe it is coming. Not the first time buyer and neither the investor to flip them for a substantial profit. Another concern is the maintenance before to be sold. This is not anymore a yard of a tracking house but a few acres of manicured landscape which implies thousand of dollars of repair is something goes wrong. This is an exciting challenge and certainly 50 bucks does no pay the work required to come with a fair value and supported by enough data. Any one have experience in this matter ???? I have heard that lenders are clue less with this topic. Starting by the loss. A tracking home valued at 500K with 100% loan and valued decrease to 350K makes 150k loss which was hard to digest in some short sale scenario.But what about a unique estate with more than a million dollars loss,...enough to generate a heart attack !
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Man... We just don't see those kinds of values in the mid-west very often. When I have had a property with few or no comps for whatever reason, I have found that the best way to tell the story of the property is on a narrative addendum. I use a word doc format and make sure I reference to order number and address and then just tell the client about the property. Usually, I get positive feedback from the client for getting them more information than they could glean from the form.
Alain, These are specialized properties and you have to discuss this with the AM or BPO coordinator and convince them that comps are difficult. For instance, a luxury home on the river or Gulf Coast may require a map search on the MLS to along the river or coast to find similar homes, or a search of similar gated communities, or, in your case, maybe a city wide search with the specific parameters. If you cannot find good comparables, you will have to provide values int he commentary, i.e., 6 fireplaces = $30,000 +- depending on what you are doing and what company you are doing it for. I hope this helpes you.
Did one in Newport Coast, someone bought as a flipper for 7 mil, and it sat empty for 1 year. I came up w/ 3.8 mil, and that took hours. Only one good comp, sold last year though. I had to go out a couple of miles. $50! The kicker was landscape on these places runs 3 to 500k, and this one was all dirt.
Speaking of the devil, I just did one at $ 8 millions, property is NOD. 8500 sqft to photos, 68 photos to download. 70 bucks fees ! That was beautifull anyway.
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