A South Florida couple with a young daughter thought they found and had a deal for the perfect home for their growing family near Coral Gables in 2012. Roughly two years later, the seller is trying to back out and they are worried that their dream home is going to get away from them completely. They originally believed that the South Florida foreclosure crisis was helping them get a great deal on a new home, but a number of snafus have prevented them from moving in.
“We found our dream home. We got a contract on our dream home and now it’s over two years later and we still don’t own the house,” said Christine Rickard.
“We saw the for sale sign. I’m seven months pregnant. We’re so excited,” she remembers. “This is exactly what we’ve always wanted. It’s perfect. Now I’ve obviously had the baby now. She’s going to be two and we still can’t close on the house.”
The couple says that the company that owned the home originally agreed to sell them the home for $405,000 but then failed to deliver the title. Now, the two parties are fighting and Rickard believes that “They want to sell for more money to someone else.”
Rickard’s case might be part of a growing trend as real estate companies are buying up foreclosed homes and selling them at higher prices. That could leave independent middle-class buyers, like Rickard, “out in the cold,” says Greg Allen.
The current market seems to favor large real estate agencies and groups who can afford to buy many properties and then rent them out until prices improve in order to make their investments profitable.
“If I had a way of buying a couple hundred-thousand single-family homes and had a way of managing [them]” Warren Buffet told CNBC. “I would load up on them. And I would take mortgages out at very, very low rates.”
“It’s become typical that buyers that are purchasing short sales or foreclosures do have risk of the property not closing, and there are several reasons for this to happen,” explains Frank Vigliotti, Realtor® at Henri Frank, Remax. “One of the reasons could be a lien on the property that the bank cannot clear quickly, or the property is need of extensive repair before they can even sell it to the buyer.”
It will be interesting to see how the market changes and grows in the coming year and if holding out for higher prices will turn out to be beneficial for large-scale buyers.
Unfortunately, for buyers like Rickard and her family, who are currently working through the legal system, that trend adds another challenge in an already complex market.