In any real estate transaction, buyers must be prepared to do a little due diligence before putting an offer in. This is especially true of distressed properties. If you’re considering a foreclosure, short sale, or bank-owned property make sure to follow the tips below for a more positive experience.
1) Find yourself an agent who’s experienced in distressed sales
Purchasing a distressed property isn’t particularly challenging, but it is different than a traditional home sale. It’s crucial to find an agent who’s familiar with these types of sales because they can better help you navigate the waters.
2) Get a thorough inspection
While distressed properties are often sold “as is”, you still have a right to an inspection. A thorough home inspection will allow you to get an accurate idea of what repairs will need to be made and how much you should budget for.
3) Check out the surrounding neighborhood as well
Don’t confine your inspection to the structure itself. Look around at the landscaping. Does the property back up against a bank that has no vegetation? Will the drainage work in the event of a heavy storm? Check out the surrounding neighborhood as well, as its condition can affect the value of your property.
4) Check out recent sales activity
Look at how many days homes have stayed on the market. Are properties moving quickly? What are the buying/rental trends in the neighborhood? How many of the homes sold were distressed inventory? Too many sales overall could suggest that people are leaving the neighborhood—see if there’s an underlying reason why.
Have prices in a particular area gone up? Have they plateaued? How do they compare to what they were during the last peak? That information should give you an idea of whether property values are going up or down, and help you figure out what you should be spending.
If you’re considering purchasing a distressed property, we’d love to help you start the process. At Metrowest we specialize in these types of sales – give us a shout today!