Thursday, July 23, 2009

Picking the Right Distressed Asset Broker

If you’re selling in this market, almost by definition you, your asset, or both are distressed. It’s also pretty likely that unless you were selling assets back in the early 1990’s you’ve not been a seller in a market like this. What to do?

The short answer is to find someone who is successful at moving similar product in your market. For example, if I were the unfortunate owner of undeveloped land in Hesperia, California, I would call John Reeder at Sperry Van Ness, because John recently brokered the sale of this 55 acre parcel there:


There certainly is a lot of vacant land in Hesperia, isn’t there? SVN’s Dealbreaker site also has information on lots John brokered in Victorville. The guy who can sell land in a market made famous by a lender demolishing mostly completed homes is the guy I would want selling my asset.

Brokers who are successful in this market are not necessarily the brokers who were successful in happier times – the skill set and often the buyers are different. From Lansner on Real Estate’s post “Big Money Now in Selling Foreclosed Homes”:

Power has shifted away from the traditional model of real estate agents representing homeowners to agents specializing in selling foreclosed homes, new data show…

Most traditional agents haven’t been able to adapt to those changing circumstances because selling foreclosures requires different skills: the ability to deal with evictions, making repairs, managing large numbers of vacant properties, plus paying out large sums of your own money, then pursuing reimbursements.

In tough times, you need an expert - for example, Leo Nordine, the Los Angeles REO broker the New Yorker profiled in their April 6, 2009 issue (abstract here).