We submitted an offer at $407,000 and there were 4 other offers at that time.  In this Santa Clara neighborhood alone there were 3 other bank owned properties on the market, the next lowest in price was $461,000 and needed just about the same amount of work.

The response from the seller was a highest and best counter in the form of an email.  For those of you who are unfamiliar with this strategy, the seller comes back to all the interested parties and asks them to submit their highest and best offer.  We responded knowing that this home was under priced and offered $420,000 as our highest and best.  That was 3 days ago and are still waiting for a response from the bank.

The other property was in the San Jose East Valley.  A 3 bedroom two bath home listed at $225,000.  There are a number of REOs (bank owned homes) in this part of San Jose.  Most need quite a bit of repair and have unpermitted additions, converted garages and all sorts of code violations.  A unique characteristic about this San Jose REO is that it only had a garage conversion that could easily be converted back.  Other than the garage conversion the home was very close to move in ready and was certainly the best home in that area of San Jose for the price.

This San Jose REO received a total of12 offers.  We are currently awaiting response from the bank.  This experience is very common as active buyers in Santa Clara County that are targeting these REO deals have slim pickings for homes that do not require too much repair.  As a result, they often get quite a bit of interest when priced low and will often sell at market prices.  This is not to discourage you from trying, rather to set your expectations on pursuing REOs.

Beds: 3
Baths: 2
List Price: $399,900
List Date: 1/28/2009
Lot Size: 5000.00 SF
SqFt: 1078
Age: 54
Year Built: 1955

Neighborhood: Bowers Crest
School District: Santa Clara Unified

Another great deal that being offered by the bank.  $400K will get you a simple 3 bedroom 2 bath home in a nice quiet neighborhood.  This same home sold for around $650K three years ago.  Not much has been done to it, but these homes are relatively inexpensive to update.  They feature small bathrooms, but adequate room sizes.  The 3rd bedroom works well as an office.  The living room is large, and kitchen is a medium sized galley kitchen.  A 2 car garage, and some back yard space make it a simple and functional single family home.  At $400K don’t expect to see this on the market for very long.