I’ve heard it many times from people who were interested in buying “I want to buy a foreclosure”. Which REALLY translates into: “I want a deal”. We all want what we want of course. This is where a bit more education on the buyer’s part that comes in. Not necessarily ‘deprogramming’, but just informing them further that in this market, purchasing a foreclosure isn’t the only way to secure a deal when buying a home in Washington, DC, yet there are some things to consider if one is still heavy on the posiblity of buying a foreclosed preoprty.
A good lead-in, is discussing the concept of cost vs. price with them and how that can tie in to any foreclosure on the market (this is a GREAT concept to discuss when purchasing ANY home, actually). Now a foreclosure can range in condition from move-in ready with not much work needed if any, to ugly/unfortunate and a miracle requiring more money to make it presentable and up to par with what the buyer is looking for, and the kind of loan you and interest rate you have attained. Yes, you can afford the price of the foreclosed property, but are you able to bear the costs it MAY take to live in it? In looking at the asking price of a foreclosed property, particularly one you have REALLY found desirable because it’s in the neighborhood you like, and you have a vision for an end result beyond what its’ current condition is, what are the additional needs to be put into owning it?
Some foreclosures may require new appliances to be purchased, some may require complete rehabilitation of the lawn, perhaps the pipes are corroded and need work…there is so much to consider in the potential costs of buying and eventually owning a foreclosure, as with any kind of property. Not that these should be taken out of your consideration, but there are many factors to consider outside of the assumptive notion one has taken that a foreclosure is the only way to go when considering a financially sound home purchase.