When you are looking at homes, and find some that you really like, you should absolutely be driving through the neighborhoods at different times of the day and week to get a realistic sense of the communities. Visiting a home in the afternoon and evening also helps you learn about the area and if there are problems with noise or traffic. Check with the police and ask for a crime report to gain as much knowledge as possible regarding the neighborhood.
You’re not only purchasing a house, but you’re also purchasing the area in which you buy it. You must investigate the condition of the neighborhood. By doing this, you’ll be able to determine whether it’s “coming back,” or showing serious signs of decline. One way you can do this is by researching how many homes in the area are in foreclosure.
Are you considering a home in foreclosure? Although homes in foreclosures can mean good deals, be sure to know the status of a home and whether or not it’s short sale eligible or purchasable if its in foreclosure. If not, you may be making an offer on a home that a bank already owns.
If you’re considering a “fixer upper” house, you should proceed with caution. A fixer upper is cheap but you need someone to tell you what it’ll cost to get it to code or market standard. If you aren’t interested in dealing with a home that needs serious renovations, you should walk away.
Are There Home Inspection Issues?
You must get a home inspection, no matter how much the home costs. It should be obvious, but any home you purchase should be based on the outcome of the inspection report. So many buyers decide that they aren’t going to order an inspection report, because they don’t want to pay for it. They only cost a few hundred dollars. You are talking about spending a few hundred thousand dollars (or more, depending on your income).
Just because a home looks nice to the naked eye, doesn’t mean that there are not underlying issues. Always get an inspection. That way, if there are issues, you can go back to the seller and negotiate. And more importantly, you can decide if you should buy the house. An inspection should give you a good, fair understanding of what’s wrong with the house. Always be sure to check the inspectors credentials and referrals. Read this article Top 10 Red Flags To Look For When Buying a Home for even more information.
Foreclosures can be a great opportunity for a homebuyer, or a real estate investor. You just have to make sure that the home is in good condition, and is only being sold because the owner defaulted. Otherwise, it could be a home with significant issues in need of major repairs, or something of the sort that you definitely don’t want to be responsible for.