September 29th, 2011 4:16 PM by Lisa Carey
According to the Florida Association of Realtors, short sale transactions are losing their appeal with first-time homebuyers. While buying a home in a short sale transaction may offer a bargain – sale prices average 27 percent lower than non-distressed properties – more first-time home buyers say the processing delays just aren’t worth the trouble.First-time buyers’ share of all short sales dropped to 39.7 percent of transactions in August – a three-month drop and the lowest share ever recorded for first-time homebuyers, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. In November 2009, first-time homebuyers’ share of short sales reached a peak of 54.1 percent of all short sale transactions.In Leon County, approximately 40% of all transactions are distressed. With bargain deals, why are short sales becoming less popular?In large because short sale transactions take too long to close, with approval times often taking several months after a buyer submits an offer. Some buyers, frustrated at the delays, place offers on multiple properties with plans to close on whichever one is approved fastest. That practice then makes multiple properties show up as "contingent, under contract" in MLS, only to have them back on the market in a few months.The average time on market for short sales is 16.6 weeks, and the majority of that time is spent waiting for short sale approval, the HousingPulse Tracking Survey found.
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