I am getting a lot of calls lately with people telling me that they want to buy a foreclosure. Maybe it’s the mentality of the market, or the late night infomercials, but many people seem to think that foreclosures, by definition are a “good deal”. They might be or they might not!
Foreclosures aren’t necessarily priced right, relative to the market conditions, or even relative to other REOs. I just checked out 2 new foreclosures in Lake Forest today. Both are within the same (nice) neighborhood, located only 2 blocks from each other. They are the same builder, age, square footage and floorplan, so a direct comparison is very easy.
The first one has a decently upgraded kitchen, scraped ceilings, remodeled baths, and lightly worn carpet. The atrium area is unfinished dirt, and it looked to me like an above ground spa had been removed from that area. The garage door is the original wood tilt-up (instead of the more popular roll-up door) and it has a wood shake roof that the builder had installed in 1975. The windows are all original, and the road noise coming in the house at 3:30 in the afternoon was quite loud. That house is priced at $545,000. (Update 7/14/2008, new price is $439,900!)
The second house, just around the corner has similar kitchen upgrades, scraped ceilings, remodeled baths, professionally installed laminate flooring (it looked pretty good), attractive used-brick walkway and atrium, newer tile roof, and no significant road noise. It is priced at $498,900. (Update 7/14/2008 – price is now $466,900!)
It’s obvious to me which lender is more serious about getting this sale done!
Please call or email me if you would like valuable information about any home for sale – foreclosed or not. I’m starting to see some well-priced homes come on the market, and they are selling pretty quickly!