Buying a home can be exciting for most families. But if you can’t afford a single family home, it can be disappointing, besides frustrating, when house hunting. If you dream of owning your own home, but don’t think you have enough money to buy one, take heart. There are several affordable ways to invest in real estate. Here are five of the most common options to buy a cheap single family home, besides where to find them.
“As -Is” Homes
During the current housing crisis, many properties are sold “as-is.” This means that the seller is selling the home without agreeing to make needed repairs, so the house is sold at a cheaper price. As a result, sellers are not held responsible for the condition of a home.
- When buying an “as-is” single family home, it’s critical to have a home inspection so that you can know what needs to be fixed.
- This entails a buyer paying for their own inspection, which typically is $250 or more, besides whatever needs to be repaired.
- Although some houses only have minor problems or none at all, others can have severe issues.
Many buyers turn to foreclosed properties when searching for cheap single family homes. Amazingly, about a quarter of all the homes on the market are foreclosures. Foreclosed properties are roughly 30 percent less than the price of nondistressed homes.
- Often, foreclosed homes are located in exceptional neighborhoods with what people need.
- On the other hand, realize that it’s likely that someone who’s unable to make mortgage payments usually can’t afford to spend money for needed home repairs.
- Thus, you’ll need to have a house inspection as most foreclosures need repairs.
This is a situation in which an owner still owns the property. Although the standard real estate rules still apply, a bank lets the owner sell the home for a less amount than that of the mortgage.
A disadvantage of a short sale is that buyers can wait for a very long time for a bank to give its approval for your offer. But this should not be surprising as, after all, it’s the bank who is in control of the money.
Considering living in a rundown or blighted area for only a buck. You can actually pay just one dollar to live in a home that’s been boarded up and is falling apart in a distressed area. The deal is that a buyer has to live in the home for a determined number of years.
During this time, buyers have to fix the home up and properly maintain it. Known as “dollar homes,” these are home acquired by the FHA (Federal Housing Administration) from foreclosure actions.
Where to Find Cheap Single Family Homes
When searching for a cheap single family home, a great deal of your time can be spent in securing listings.
- Check the legal notices of your local newspaper—This is a good place to find legitimate auctioneers who auction off foreclosures on the steps of their local courthouses. It’s legitimate as you don’t want to be deceived by phony auctions or auctioneers.
- Look at bank websites—Some banks have listings of properties. To find listings, search bank names, along with “RFO” (“Real Estate Owned”)
- To find “as is” homes, check out foreclosures, besides private sales.
Considerations and Warnings
- Be leery of questionable companies or ads that charge a lot of money for old listings.
- Some people believe that short sales are a better deal than purchasing foreclosures as they’re typically in better shape simply because they’ve had people living there. This can mean that the lawn and utilities have continued to be maintained.
The Deed XChange™ has listings of cheap single family homes. Check out our online dashboard that helps both sellers and buyers. Please Contact Us.