Northern Cal REOs ???

[Norcalkid]

Hi,
I am new to this forum so first I just wanted to say hi.
Just wonderind if there are any agents out there from Sac or the bay area. I have been considering buying a reo in the area to rent out. I am wondering what kinds of prices banks have been accepting compared to their asking prices. They don't seem to be as desperate to get rid of these houses as I thought they would be. I guess maybe were just not there yet. If you were going to make an offer on a house that is not in need of mejor repairs what % of the asking price would you start at and where would you expect to get it. One person told me they always start at 40% and hope to get them for 50-60 when dealing with banks. Does this seem reasonable to you or do you think they are full of it? I am approved by a lender and have a down but I am just not sure if its time to start buying yet. But if I can get these homes for 50-60% why not.
thanks

[Hannigan]

I work in the greater Bay Area, and prices are holding up for the most part. The bank-owned properties I've seen aren't priced to where 50% offers would likely be accepted, but you never know.

[TahoeResource]

Sometimes banks will reduce their sale price to unload the property, but typically not by 50%. A foreclosure or short sale will almost always include a professional real estate appraisal and or several BPO's (Broker Price Opinions). Even though banks are not in the business of owning property (it ties up the funds they use to lend money with and creates a liability), they also want to sell the property as close to market value as possible.

Banks will consider the amount of the deficient loan against the property when an offer is made. For example, if the market value of a property was $500,000 and an offer was submitted for $400,000, they would be more likely to accept the offer if the loan against the property was $250,000 than if it was $450,000.