Short Sales was the lead article in the Chicago Tribune this Saturday May 31, 2008. The article” Break for Sellers: Banks settle for less” defined short sales as the process where homeowners owe more than the house is worth.It went on to say that the housing crisis is so severe that both lenders and home owners see short sales as an acceptable alternative.

It is good to see an article open to discuss a difficult topic and it is even harder to give accurate information on the subject. For instance, the article interviewed a realtor who feels short sales is “screwing up” a lot of stuff. This realtor went on to say short sales in his market was the healthiest part of the real estate market now along with bank owned property. The article also accused short sales of scewing the market data, bringing home values down, and making neighborhoods look less valuable. I thought about this long and hard and decided to see some data in my own real estate market of Evanston, IL. Right now, Evanston has 360 single family homes for sale. There are 15 homes listed as short sales, and another 3 listed as bank owned properties. These 18 homes represent a total .05 % of the real estate market in Evanston. Clearly, it will take a long time for short sales to take over the real estate market in Evanston, Il.  During the past couple of months 1 short sale has gone under contracct, 1 short sale has closed, and 1 bank owned property has closed in Evanston, IL.  I cannot blame the loss in value to all homes in Evanston, Il to these few  sales.

Further down in the article it stated it can take up to six months for lender approval for a short sale and this alone is removing potential buyers from considering non-short-sale home listings. While it is taking longer for banks to approve short sales it is not taking them away from normal real estate transactions. In Evanston there are 83 homes currently under contract and only 1 of these is a short sale. Clearly there are buyers looking to purchase homes that are not short sales in my market of Evanston, IL.

I think I am going to end this by saying that short sales are a realty and need to be dealt with but it should not be blamed for all of the problems we are now facing in the real estate market.