Are Foreclosures Bargains?

Teresa Boardman says no.

It is a myth that bank-owned properties are a bargain — some are, but many are not. The bank-owned homes that are priced very low often need so much work that the cost of the repairs is more than the value of the home after the repairs are done.

I don’t take issue with her views. I rarely do bank-owned foreclosures but I am very active in brokering Lis Pendens and short sales. They are good deals, but not great deals. Way back when in Rochester I sold quite a few HUD homes (FHA repossessions). The prices more or less equaled the retail value of a fully improved home with the cost of needed repairs subtracted. It was a great way to enter the world of home ownership for your primary residence, but you seldom saw a flip candidate.

Read Full Post »