Reasons not to buy a Short Sale Home
I have buyers all the time talk about what a deal they can get by purchasing a short sale, or pre foreclosure home. To start with, short sales are distressed properties. I offer my opinion, and recommend that you do not purchase a short sale home. Read below:
1. These homes often have no power or water. Without power, there is not climate control, which allows mold and other wood destroying bacteria to form. This is not only expensive to repair, but is a health hazard.
2. These homes represent someone losing everything they own. Their home is lost, their credit is destroyed, and they are not leaving in a good mood. They can sabotage the structure, and have bad feelings towards the people who buy the home. Put yourself in their shoes.
3. Homes in foreclosure have lacked proper maintenance. For how long, is anyone’s guess? Termite bonds have expired, and are costly to activate, lawns are in bad shape and need to be re-worked, and the list goes on.
4. Just because the home is listed at a certain price does not mean that a full price offer will buy the home. Your offer is just that. They bank will usually look at several factors, and perform an appraisal on the property. Most likely, the lending institution will ask for more money than is offered.
5. The purchase of a short sale home is made on an “AS IS” purchase agreement. There is a reason for this. Think about it.
6. Short Sale purchases can take from 30 days to 6 months to close. I have heard of people waiting 3 months on their offer, only to have their offer countered with a higher price. Then the process starts over. The whole time, your deposit is sitting in a non interest bearing account.
7. Only 20% of short sale contracts ever make it to closing. The other 80% either end with counter offers that are too high, or the buyer gets tired of waiting, and moves on.
8. Non foreclosure homes are comparatively priced, as is new construction. If you can purchase a custom built home, with a warranty, and designed around your needs for a few thousand more than a short sale, why would you not build a home? Auburn Homes, Inc. has custom homes starting at $109,900 on your lot. That’s a 1200+ Sq. Ft. home with 3 bedrooms, 2 baths, and 2 car garage. If you do not have a lot, I will be happy to assist you with finding one that is within your budget.
9. If you do purchase a short sale home, please keep Auburn Homes in mind for
renovation. More than likely, there will be lots of work needed on your new purchase.
Read an article written by Toby Tobin in Palm Coast about short sales. This will help you to learn more about the proecess. Just click the short sale button.
