Distressed Property Blog

Starting on the 23rd of April, thousands of RE/MAX websites went live with “a new consumer foreclosure property search feature,” according to company officials. The new functionality is reportedly part of a strategic partnership between four independently owned RE/MAX Regions and RealtyTrac (a leading source of foreclosure data). Reliance Network, a developer of Web-based applications for real estate companies, is also involved in the partnership.

While this will serve RealtyTrac well (in that it provides a new outlet for customer reach), I am not sure how this will help the RE/MAX consumer. In reality, RealtyTrac provides nothing more than can be found in the Legal section of your local newspaper every Friday.

The vice president of marketing at RealtyTrac, Rick Sharga, says, “This new search application will pull real-time data directly from our nationwide foreclosure database and provide consumers with a method to access distressed properties.” But the way I see it, there is a serious problem here.

While a property may be on a list, that does not in any way suggest the property is actually for sale. Conversely, we are finding more and more that properties on these lists are being “cured” through multiple methods (e.g. restructuring of the loan by the lender, a loan workout, the home owner coming up with the funds which make the listing inactive, the house has already sold, or the client has already walked away and doesn’t care if the property goes to foreclosure or not). Out of these scenarios, I ask you, which one presents a buying opportunity?

The fact of that matter is that there are very few (and getting fewer) distressed properties that are TRUE pre-foreclosure and wanting to sell. In other words, RealtyTrac clearly got the upper hand in this deal.