Cheap Foreclosed Houses Are Drawing People like Magnets
Cheap foreclosed houses are drawing people like magnets. Within two years the value of a house in Glendale fell from $259,000 to $113,000. One in Phoenix dropped from $190,000 to only $45,900. It had cost $275,000 to build a house in Queen Creek in 2005. It was recently asking for $78,000. The entire real estate market in the Valley has gone upside down. Nearly half of all the houses that were sold in the real estate market in the Valley in 2008 came from the foreclosure category as per the findings of The Arizona Republic.
The buyers are a motley lot – investors, first time potential buyers and people improving their life styles by moving into bigger and better homes. The houses too range from new ones to old ones and from condos to single family units. There is plenty to choose from especially in the range of $100,000.
Over half the units are bank repossessed houses or those about to be foreclosed upon according to Cromford Report. Experts feel that in the next few months the numbers will increase as the moratorium period expires.
The potential buyers can get all the information they require from the Internet and or from realtors. It is best to make a check on the locality before buying. If there are many foreclosures in the neighbourhood then it will make life difficult for occupants. Those planning to rent out the house should check the local rental market. If there are too many units searching for renters then there is the possibility that the house will have to remain empty for quite some time. Too many empty foreclosed homes may mean that these too may soon become rentals also.
Julie Bieganski is a realtor. She advises looking into other homes in the same block and to check on schools, road-rail connectivity and shopping facilities. Her suggestion is to look for the ugliest in the block.
Brett Barry of Realty Executives said, “You are going to find the real deals on the homes with the most (physical) damage in the neighborhoods with the highest foreclosure rates. Those are the homes that draw the multiple offers.” He opined that banks are reluctant to spend above $20,000 to refurbish the foreclosed units. The more the house is damaged the more is the discount. Some of the units have been stripped of fittings and fixtures including tiles and even the toilets by the former occupants and later by the vandals.
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