Have you heard? You can buy foreclosures for almost nothing...

The commercials are driving me crazy...  I hear them constantly.  Two women talking about buying a house, and the one woman tells her friend that she paid $20,000 for this beautiful 4 bedroom home. 

The announcer kicks in that there are actual listings for 4 bedrooms homes for under $20,000. 

They cut back to the ladies, and the friend has now bought a house for $102/mo. 

Ok, this isn't Detroit.  This is Gwinnett County, GA.  In Detroit there are homes that are overpriced at $500.  They need more work than they are worth, and even bulldozing it and building a new house is pointless because of the overhead inventory.  But that isn't the case here. 

Any home in Gwinnett County that is under $20,000 is not going to be habitable.  There might be one out there...  But I wouldn't hold my breath. 

The problem is...

There ARE buyers holding their breath.  They are sure that homes that are priced at $200,000 right now will magically be priced at $19,000 next year.  That isn't to say that prices might not come down... but they are almost as likely to go up.  And the range for either is fairly narrow. 

And the OTHER problem...

Right now there are rates that are close to, if not touching, the high 4% range for a 30 year fixed rate loan.  And even a small change... say 1/2 of a percent (.5%)... could mean that you are paying as much per month for a $250,000 loan as you would have been for a $262,000 loan.  If rates were to go up a point, that would be like raising the price by another $13,000...  Now that $250,000 loan is going to cost the same as a $275,000 loan. 

So, if the prices were to remain flat, but rates rise, the money you spend each month buys less house. 

So...

Alway keep in mind that there are  a lot of components that go into a home purchase.  Aside from things like the $7500 First Time Home Buyer's Tax Credit, there are interest considerations, price, location and area... also condition and construction. 

If you want to see what IS available, drop into LilburnDwellings.com.  I will be starting a new series looking at deal in the Lilburn and Gwinnett County area.  These will be homes that are priced attractively in the market, both foreclosures and other sellers.  When you are ready to buy a new home, feel free to give me a call.