The buzz words of 2007 are most likely going to be “bank owned”, “foreclosure”, and “short sale”. As you can imagine, there are thousands on the market right now that are trying to compete with each other, and sadly, no one is buying.

So imagine how difficult it is going to be to sell a Million dollar home that has gone to the bank. The property is automatically stigmatized by the words “bank owned” and any potential buyer of a high-end home is going to want a nice discount to purchase it.

According to the Regional Multiple Listing Service, there are five homes currently for sale,
priced above a million dollars, owned by the bank or subject to bank approval.

1. The most expensive is priced just under $3 Million in Edina. The original 1972 home was torn down in 2000 and a huge mega-mansion was built in it’s place in 2003. The home is a prime example of “just because you build it, doesn’t mean they will come“. The “estate” has been on the market for the last four years, originally priced at $6 Million. That’s a pretty hefty price tag, even in Edina. It is a beautiful home, but it has never been lived in and I doubt it will sell any where near it’s current asking price.
2. A home in Mahtomedi listed for $1.1 Million was just built in 2006, having replaced a tiny home that was torn down.
3. A beautiful Craftsman inspired home is for sale in Inver Grove Heights. Bought just a year ago for $1.4 Million, the current price is at $1.3 Million. Sadly, the price will have to come down a little more to attract a buyer to that area.
4. The Wayzata address keeps one listing high at $1.5 Million, but the home was built in 1989 and needs some updating. I hate to say it but the indigo blue kitchen cabinets are going to be a hard sell in the price range. It also doesn’t look good to have been on the market for a full year with a price reduction of $800,000. I think this home will have to come down even more, especially with the bank being involved.
5. Lastly, the one that might be the hardest to attract a buyer, is a modern designed contemporary home in Medina. Modern doesn’t do too well in rural Minnesota. It (modern design) has a better chance in downtown Minneapolis. I hate to say it, but it is just plain ugly. Minnesotans that live on lakes and acreage, tend to lean more towards traditional and Craftsman styled homes. This one, priced at $1.3 Million, is going to be a very hard sell.

So there you have it, even Million dollar homes can have a tough or tougher time selling than other homes. Many times, an expensive home has been built in an area that doesn’t support that type of home. Finding the right buyer becomes even more difficult because most will see that they can buy in a more affluent neighborhood for the same price. It will be interesting to see what happens to these homes. Since the banks are involved, I am sure price reductions will be few and far between, and the homes will just start to rot from neglect. That is the one big down side of banks getting involved in real estate.