Buying Property At Auction For First Home

Individuals who are buying their first home may want to consider buying property at auction. Here are some things to think about.

Buying property at auction can be a way to purchase an affordable first home. Many individuals who have rented their abodes because they felt they couldn’t afford a piece of real estate may be able to buy after all. Back during the housing boom, prices rose so high that they became way too expensive for many individuals. Those who were saving up for purchasing their first house may have become discouraged as they watched the prices rise up and off the charts. Having savings accumulate at a turtle’s pace while price tags were running away like rabbits was discouraging indeed. Many may have given up hope of ever achieving home ownership. But this has all changed. Due to the burst of the housing bubble, many properties are on the market for unbelievably low dollar amounts. Not only have the values dropped substantially but there are various ways to track down distressed properties for even less money. Foreclosures and those being sold to pay off homeowner tax debts are being offered for relatively tiny amounts on auction blocks around the country. Interested? Here are some things to think about:

- Locating auctions: Auctions are being held by municipalities, banks and firms specializing in getting rid of distressed properties. Municipalities have real estate which has been seized due to unpaid tax liens and nonpayment of property taxes. Listings for these repossessed abodes are available at the local county courthouse or in the legal notice section of the newspaper. These listings come out weeks or months earlier than the auction dates so that prospective buyers can check them out ahead of time. Banks and mortgage companies often have websites which list houses which are up for grabs. Some firms specializing in auctioning off places post signs in the front yards of homes notating the date and time of the auction.

- Financing: Auctioned off properties are sold on a cash basis. Buyers need to have their financing all set up and be ready to hand over right away. This doesn’t mean that buyers have to have every dollar in cent in their checking account, but they do need to make arrangements with a lender to pay the auctioneer if they are the highest bidder.

- Sold “as is”: Homes that are sold in this manner are being offered “as is.” In traditional real estate purchases, a buyer may have an inspection period in which the place can be looked over with a fine tooth comb. If there are any problems, the individual can ask the seller to fix it. With these types of auction-block sales, the purchaser must make all repairs themselves. This is why it is wise to thoroughly survey the structure, cosmetics and neighborhood to see if it’s a good deal. If the place needs thousands of dollars of renovation, this should be added on mentally during the planning stages. A first time home buyer needs to ask themselves if this is still a good deal when the math is done.

Individuals who have been salivating to purchase their first home-sweet-home may have the opportunity to finally do so. Buying property at auction may be the answer to their prayers.

Article Tags: Buying Property, First Home, Real Estate

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