patrick.net

corntrollio says

Those short sale prices are often completely made up.

Ask to see the appraisal once it's complete. I know with FHA, they set the minimum net proceeds at 88% of the appraised value on a short sale. So multiply the appraised value by 0.88 and that is what has to go to the lender after all closing costs are paid. Typically they'll work backwards from that to get their list price. They do that calculation, then add up all their closing costs, add the two, and there's your list price. (or a bit higher)

The 88% is non-negotiable (lender won't approve SS without that) but all the other costs are, including the realtor's commission. And in this day and age, many agents will agree to take the hit from their commission to make a deal work (say if you were close, like 86% net proceeds, the agent will relinquish a percentage point or two on the commission to get up to 88%) The fact that agents are allowed to earn commission on short sales really doesn't sit well with me in general. The fact that both the owner and the bank are taking it in the ass and somehow a realtor slips in to grab 6% off the top is ridiculous.

Don't.

First of all if you cant move their for a year or two why the hell would you pay someone to live there? It's not a good deal, it's a very very crapy deal and you'll be wasting a ton of money being upside down.

It's not like houses will go up in prices magically, world lately ran out of idiot money.

I don't live in bay area, but 500k+ for a 3bd sounds like a huge rip off to me.