Foreclosures tend to have a negative reputation, as they are often associated with properties in need of significant improvement; however, many foreclosures just need a little cosmetic work. By working with a realtor, you can ensure that you avoid getting involved in a project –both physical and financial—that exceeds your means.
Dispelling the Foreclosure Stigma
When it comes to real estate, the word ‘foreclosure’ is often the forbidden “F” word no one wants to hear; however, foreclosures can be sound investments that can lead to higher payoffs than conventional real estate. There are many tricks to wisely buying a property in foreclosure status two of which are to use good judgment and to be mindful of location and future property values.
Why Foreclosure Doesn’t Automatically Equal Negative
Once upon a time, foreclosure was synonymous with derelict. In today’s market and economy, such is not the case. Very often, foreclosures are attractive and still readily revivable properties. What this means for prospective homebuyers is that with a little proverbial elbow grease, a foreclosure can quickly become the best house on the block.
Foreclosures get a negative stigma because 20-30 years ago, many were in states of extreme disrepair when they appeared on the market. They needed updates and upgrades to be brought up to code. The effort was often only worth it to a homeowner who was genuinely invested in the home and the area in which the home was located.
Today, foreclosures are often still in comparatively nice condition; they typically only need a little cosmetic enhancement to be livable and are very attractive to both investors and homeowners alike.
Wise Investing Strategies
While some homebuyers do buy their foreclosures from auctions, the majority of homebuyers who buy foreclosures do so through realtors. This is the wisest way for buyers who do not have expertise or licenses in home renovation to proceed.
Go Through a Realtor
Though there are several reasons to buy through a realtor versus buying a property from the bank is your ability to have an inspection. Auction foreclosures are sigh unseen. Buying through a
- An inspection – Buying without an inspection) mean you take the property “as is”, so if there is toxic mold or damaged electrical, you are obligated to deal with it as the property owner.
- The knowledge that the house is unoccupied –This means that you will not have to contend with evicting the former owner)
- That you can afford the investment – A house that you can afford in a neighborhood that’s three times your budget? That’s great until you have to maintain in and pay bills on a house like that. Make sure the property is one you can manage once its in top shape (because you don’t know how long you’ll have it, even if you are planning to flip the investment)
- That you’ve done all of the math – Even the cleanest foreclosure needs work whether it’s a new lawn treatment or some interior touchups or just some general remodeling. When buying a foreclosure, factor all of the renovations into the grand total.
- That you don’t get carried away – Oftentimes, foreclosures have multiple offers, which means you will be asked to bring your best offer to the table. This could mean going well above your bottom dollar and cutting clear into your renovation budget. Your realtor will help you keep your head above water and make a sane determination about a foreclosure before you get in too deep.
Foreclosures can be excellent investments. They are typically nice pieces of property that just need a little attention. Usually, foreclosures are fantastic bargains provided the purchaser not get carried away by bidding and that the purchaser put the necessary precautions –like an inspection—in place to ensure he or she is getting a property he or she has the time and resources to manage.
If purchased in the right location and for the right amount, a foreclosure can be a savvy investment for either a property owner or for one looking to flip a piece of property. So, from now on, don’t shy away from any foreclosure you happen to see on 30A; call your realtor and schedule an appointment to view the property and explore your options.
The sunny beaches of 30A are home to some of the most beautiful condominiums, beach houses, and cottages on the Florida Gulf Coast. The communities that pepper the sugar white sands of the Florida Panhandle are ideal locales to call home or to have a vacation home. If you want to get invested on 30A, contact local real estate expert, Melissa Clements, your personal guide to all things 30A.