Buying a Home? Good Time to Consider the Foreclosure Market
If you are considering buying a home in DC, you may want to consider buying a foreclosed home, also called a real estate owned (REO) or bank-owned property. Current data indicates that banks are seeking alternatives to foreclosure, so now is a good time to explore the home foreclosure market.
Why look at foreclosed properties?
Housing prices are still below their peak in 2006, and another wave of foreclosed properties is expected to hit the housing market this year as banks unload their backlog—offering homes at low prices. Washington, D.C. and New York have shown relative strength and have home prices at least 50% above 2000 price levels, but still below their peak.
How do you find a foreclosed home for sale?
In the DC area many foreclosed homes are listed for sale the same way as traditional homes. In addition to searching the usual resources such as newspapers and online real estate listings and websites, you will want to search various bank and government websites for REO properties. Simple online searches for “REO properties” or “foreclosures” will result in a variety of online property resources and listings.
As your real estate agent, I can help you search for the best foreclosure properties. The two most common ways of buying a foreclosed home are through a real estate agent or through a public auction.
How is buying a home from the foreclosure market different?
A foreclosure property is often sold “as is.” This means that the home inspection is critical to you as a buyer. Be sure to have a licensed home inspector evaluate the condition of the house.
- If owned by a bank or real estate company, a record of repairs and maintenance property may not be available. As a result, the bank is often unable to verify the condition of the property or complete a Seller’s Disclosure.
- The cost of any repairs will become your responsibility. When buying a home “as is”, you will need to factor in the costs of the itemized repairs in addition to the mortgage payment.
The best advice I can give you is to engage an experienced real estate professional when buying a home from foreclosure properties. As a real estate agent, I have the expertise to guide you through the foreclosure process, including the contracts and home inspections. Contact me to set up our first meeting.