Without a doubt, Foreclosed properties and First Time Buyers are my favorite types of real estate to work. All too often, especially in this market, I am finding these two groups trying to merge.
Buying a Foreclosed home is not for everyone...and I believe...especially not for a first time buyer.
I truly enjoy working with the novice home buyer. They are fresh. They have not been jaded by bad experiences, bad agents or bad choices that some homeowners have faced. They are hungry for information and most know how to find it. They are normally savy and have done alot of their resarch before getting to me. Not that all of this research has yeilded correct information that relates to our area, our maket, our trends. However, they are normally ready to listen. Ready to hear advice.
Alot of the first time buyers I work with want a move in ready house. . They know how many bedrooms, baths, garages...big kitchen, large closets, fenced yard, nice baths. They want it to be pretty...with a solid foundation and newer big ticket items. So that is what we try to find.
But the following conversation has become almost inevitable in this market, normally after finding something that meets all of their criteria:
"Well, the other day I was talking to my (mom, dad, sister, brother, cousin, uncle, aunt, co-worker, friend, clergy member, neighbor, butcher, baker or candlestick maker) and they said if I want to get a really good deal on house, I should be looking at foreclosures. What do you think about that?
Everyone wants to help. When someone is buying a house for the first time, it can consume them. It is on their mind and they share their thoughts with anyone who will listen. And the people who listen normally have opinions too. Everyone loves to talk about foreclosures now and with good reason. Even consumers who don't follow this kind of thing can see the signs popping up in their neighborhoods. And it is hard to turn on the television, open a newspaper, or browse a website without hearing of the rise in foreclosed homes. How many websites are dedicated to buying or receiveing "free" a list of foreclosed homes in your area?
And I am a huge proponet of buying foreclosed homes. I have had a few myself. They can be a great deal and there are plenty to choose from right now. But they are a pain...plain and simple.
Foreclosures are not "normal" and you cannot expect a bank to react the way a traditional home seller would. Would you like to know how old the roof, HVAC, applicances, hot water heater, or driveway is? Or how about if anything works? I can't tell you and the bank can't either. Instead of waiting a few hours, possibly a few days, to hear if your offer has been accepted, try waiting a week or more. Want to do inspections? Thats fine, of course, but make sure you have all of the utilites turned on in your name so that they can be checked. The bank is not going to do this for you. And if things don't work out, if the house doesn't pass your inspections, make sure you turn off all of the utilites and possibly pay a re-winterization fee.
First time home buyers can easily get overwhelmed in the standard home buying process. When you throw in the added difficulties that REO homes can pose, it can become a disaster. Most novice buyers have great emotional attachment wrapped up in the home they want to purchase. In my opinion, the only way to buy foreclosed homes is with emotional detachment.
There are always "good deals" to be found in any real estate market. But foreclosed homes are not the only way to go. And is a "good deal" always a "good deal" to every type of buyer?
Carrie Lehew - Realtor