Were splitting hairs on wording. Maybe “auction” is not the perfect word to use, but there is a “process” that involves bidding for the properties, in essence it is a “sealed-bid” auction.
You are correct, there is no auctioneer on the courthouse steps, etc. According to the website:
“Your real estate agent must submit your bid for you, either by telephone or internet…At the end of the Offer Period, all offers are opened and, basically,
the highest bid is accepted”
When I hear the word bid, I think auction.
And the “Broad Level Brokers” do not have exclusive rights to market the property like in a normal MLS listing situation. I look at all the HUD’s in my target area, and have to date never seen a Realtor’s sign out front. This is different than other parts of the country, where HUD has started a program to list houses with brokers.
And I have bought one of them, so I have been through the process.
I have located a boarded up townhouse, in a row of five nice ones in a good neighborhood. OCtitle says that it is currently owned by HUD. The problem is that there is no RE agent sign in the yard. I therefore do not know who listed this property initially. Can I call HUD directly to get inside (boarded up) and then possibly make an offer? How do you contact HUD, and who (what position) should I ask to talk to? I know they must be wanting to unload it, because I am assuming that they are the ones that boarded it up. And from what I have read here in the past 2 days, I may be able to buy for a song!
HUD rebates 50% of the purchase price if the bidder is a police officer or a teacher. This most likely causes the price to move above market value as police and teachers can bid twice the market value and still come out even. Keep this in mind if you bid, cards are stacked against most bidders.
I live in MA. Here’s an example of a HUD home that I’ve seen:
Boarded up house. A woman saw it, asked town hall about it. Found out that HUD owned it. I’m not sure if this woman actually called HUD or asked a realtor to call HUD. Anyways, she found out that yes, indeed HUD owned it, it just hadn’t been offered for sale yet. Within a week or 2, (since someone inquired about it, according to the person at HUD), it was offered for sale, This property had been empty for awhile, so who knows why it wasn’t listed sooner.
I’m not sure if around here HUD lists with one particular broker on certain properties, but the sign in the window of this particular house simply says that it’s for sale and to ask a Realtor about it. It’s not listed by any one particular agency.
And the HUD prices around here are not a steal by any means.
Be careful when relying on the information in octitle.com. On on property I looked up, the ‘owner’ information that was listed was NOT accurate. I verified this through my MLS system tapping into the county tax records directly. There was a sale of the property over 6 mos. ago that was not reflected on the octitle.com database.
I’d also like to email the both of you just to compare notes and see if there are any possibilities of me working with either of you at some point. Ron I think I know that you do rehabs, I may have a line on a good candidate in Rockville right now. Tom, I’m not sure what your area is, but would like to know. Please bear in mind that I am a NEWBIE, however very motivated, with a fair amount of knowledge for someone just starting out.
You won’t ever see a Realtor’s sign, either. In Md, HUD still disposes of property via it’s own auction process, without ever listing them in the MLS. The web site is at:
When HUD homes are available for purchase, they are listed on HUD’s website. Look at www.hud.org/i3/md for the current listing.
In Md, HUD multiple lists its’ properties through realtors. You must make an offer through a realtor. HUD will not sell directly to a buyer.
You may find that the property you saw is not currently available. HUD puts its’ sign up immediately and keeps it there until the house eventually gets to settlement. As a result, this particular property may not be listed yet or may already be sold.
Finally, don’t count on getting this (or any HUD house) “for a song”. HUD used to be a good source of properties for investors – i.e., priced where we could make money on them. For the last year or so, they have been pricing them higher – and getting their price.
HUD homes tend to command a higher price than one would expect because they are very accessible – listed on the internet, master keyed so you can go in them without an appointment, etc. As is often the case, when you don’t have to work too hard to find something, you are probably paying more than if you are out digging for deals.
In my market area, only designated properties are eligible for the police/teacher 50% program. At the moment, only two of properties in the HUD inventory for the market area are in the program.
If you read “expert” TomC’s reply below, you’ll see that:
He acknowledges that HUD properties are, in fact, multiple listed
He acknowledges that there is a listing agent, (although he doesn’t serve exactly the same role as in normal listings)
I don’t understand why TomC initially contradicted me.
As for whether they auction off their properties…HUD does periodically hold auctions where they get buyers in a big room and sell off many properties to the highest bidders. This is what most investors refer to as a “HUD auction”.
Their normal selling process is to take “bids” for 10 days after the initial listing of a property. Contrary to what TomC suggests, they do not necessarily take the highest bid. If they have multiple bids for the same property, they do take the highest bid if, and only if, it is at a price that is acceptable to HUD (which may or may not be below the listed price). Subsequent to that initial bidding period, they open bids every day. If they get a bid that is acceptable to them, they take it.
No, the propery will never hit the MLS or be listed with a Realtor. Any Realtor that is registered with HUD can represent you in a bid. Any Realtor can advertise on HUD’s behalf about the existence of the home for sale, but they can not call it “their” listing.
First, HUD has not had an auction in MD for at least a few years. There is no on-going auction process.
Second, HUD houses are, in fact, listed with a realtor. HUD contracts with a handful of brokers that are call Broad Level Brokers. They get up to 1% commission for entering the property in MLS, providing HUD with a price opinion, and other administrative duties.
You shouldn’t be so quick to offer info (and disagree with other posts) when you clearly don’t know what you are talking about.
