I was asked where a buyer can research comps to determine the value of a property. Wow! This is a loaded question.

Zillow is a common place to research property transfers. It's based off data through the county recorder's office. However, the full scope of a sales transaction is not provided. For instance, a condo transferred between husband and wife through a divorce settlement may not be full market value, as well as an estate transfer, sale with owner carryback, short sale, or exchange. Factors involved in the sale don't show up on straight numbers.

My recommendation to any buyer researching comps with the intent to make an offer is HIRE AN AGENT. In most markets the seller pays commission to their agent and the buyer's agent, so it costs the buyer nothing to hire representation. Real estate agents have access to the MLS data that you don't, and they can determine a market value based off all the information not just the final numbers.

I have a new listing at 575 Bell Street in East Palo Alto. The house is boarded up. The value is in the land, listed at $329K. No photos on this one, but if you're an investor or builder, take a drive by and let me know if you'd like more info.

I'd like to relocate to be closer to family but my house is not worth what I owe. Can I just call the bank and do a short sale?

Short sales aren't easy or a sure thing. On one of the short sales we have, the bank took almost six weeks to reply and the two lenders still couldn't come to terms with what they would accept. They were still bickering by the time the buyer found another house. In the meantime we see every other non-short-sale-listing go into contract, usually within 30 days of listing.

Banks also aren't the most communicative people to work with. Many buyers and agents avoid them for this reason. If you can call your bank and have them agree to a short sale just like that, it's a good sign. Far more likely you will call and call and be redirected and call and redirected and….you get the picture. So if you think this is the best solution, start communication with the bank now and see if you can get in touch with someone who can really respond. You need a point of contact first and foremost. If you don't have contact with a decision-maker you can not sell the house for less than the payoff amount. If you have a first and a second mortgage it becomes doubly difficult.

Consider renting your house out if that is a financial option. If you can get 80% of your mortgage covered by rent it is better than paying it all while you're not living there and the credit issues that may arise to position yourself for a short sale. Or, postpone your relocation if possible, especially if you have the finances to keep your mortgage current.

We plan to purchase a second home we may retire to in 10 to 15 years. What advice do you offer in selecting a good investment in today’s market?

There are good opportunities to be found in today’s market. However, be cautious in what you deem a bargain. Homes that are in foreclosure, short sales, or on the market by an over-extended seller aren’t always a deal. Some of those homes may be overpriced due to the debt against them. And, often as not, they are sold as-is under stringent loan terms you can’t negotiate.

If you are a knowledgeable, experienced investor and understand the foreclosure/short sale process and can evaulate the integrity of a home before making an offer, a distress sale may be a great opportunity. I recommend you research comps or have an experienced buyer's agent assist you through the process. Interest rates are low and you can, with some cash down, make a good investment purchase that will pay off in the long term. House flipping is risky, so your plan to keep it 10-15 years is a wise strategy.

Remember that if you offer on a short sale or bank-owned property, it usually will take longer to get acceptance than if you were buying directly from an owner. The bank must approve price and terms.

A short sale occurs when a home is sold for less than the loan held on it. For instance, a home sold in 2006 was purchased for $475K with 5% down. The market drops, the value is less, and the owner has financial difficulties or is in an adjustable mortgage and can't make the payments. If the loan is $450K and the current market value is only $350K, the home can't be sold unless the lender agrees to take a settlement of less than the amount borrowed.