I have a friend that recently asked me for a list of foreclosures. He was sure that was the best way to get a good price on a home. I had written an entry about this subject about a year ago and figured it was time to repeat it.
People get an idea stuck in their head of how to get the best deal on a house and sometimes ignore reality. Several years ago I would get calls from people that wanted to buy an “equity”. That meant they wanted to assume someone’s loan. In the 1970’s and 1980's you could pay someone a few thousand dollars, assume their low interest loan, avoid some closing costs and not even have to qualify. Now the new interest rates are often as low or lower than the old rates are, you have pay additional fees, and have to qualify to assume a loan, so this is not normally a good way to buy a home. Now I sometimes get calls asking for foreclosures, or HUD owned homes. I think these calls are motivated by some late night television infomercial that is trying to sell books or DVDs or computer programs that supposedly help you make huge amounts of money in Real Estate. I have always thought that the “huge amount of money” those infomercials make is in sales of their product.
Real Estate can be a great investment for all of us. If you ask your grandparents what the best financial investment they ever made was, chances are they will tell you about how they bought their home (for what now seems like a very small price), raised a family in it and years later they sold the home to help fund their retirement. Their payments averaged out much less than they would have paid in rent and they had tax deductions besides!
When you are buying a home for your family or property for investment you should look at the location most heavily and also look at the condition, and price. Who owns the house and why they are selling it might help you figure out how to best structure your offer but it should never influence which house you buy. The house that best fits your needs may happen to be a foreclosed property, or it may be one that someone is selling so they can move to Indiana or to a larger home, or maybe they divorced or maybe you have chosen to buy a new home from a builder.
What I am saying is Still Brothers & Associates has all of these homes available to show you. Look at the entire market and see what property is going to give you the most value for your money. I have seen foreclosed homes sell for way over what I felt fair market value was, just because the buyer had an unrealistic idea that it was the best way to buy a home.
When I last bought a new car, the dealer showed me something called “total cost of ownership”. It included the estimated resale value for the car four or five years down the line. We all know that some cars retain their value better than others and that should figure into what we estimate the car cost us. It should also figure into how good of a buy a house is. Since you can’t easily move a house, look at the neighborhood (how well are the surrounding houses and yards maintained?), the schools (do they educate the kids well?), the parks (are they kept up and inviting?), the libraries (do they appear to be up to date and popular?), and all else that surrounds the house you are thinking of buying. What do you think the neighborhood will be like in ten years? Buy in a neighborhood that you believe is going to be desirable while you live there and also in the far future when you sell. If you pay a little more for a quality home and neighborhood, you will enjoy it more and it will resale for a better price. I can't predict the future but I can give you advice and help you find information on most of your concerns. Give me a call here at Still Brothers 817-496-9484 and I will be happy to talk.
Years from now when your grandchildren ask what the best financial investment was you ever made, look at your family home.
