Buyers Expect to Pay 30% Less For Foreclosure

Submitted by Patty Massare on Tue, 2011-02-15 11:49

Results of a recent survey conducted online by Harris Interactive on behalf of Trulia and RealtyTrac showed that 67% of U. S. adults would expect to pay at least 30% less for a foreclosed home than a similar home that is not in foreclosure.  And, 35% of U. S. adults would expect to pay at least 50% less for a foreclosed home.

Often this expectation is realistic!  Because many foreclosed homes have been vacant for a long time and the utilities are not on, brokers and appraisers often price properties on the assumption that the furnace is bad and there may be water leaks or worse.  Often the properties have been vandalized and have latent defect issues.  Not only that, but buyers are buying "as is" and need to be compensated for the risk of the unknown.

If you have the stomach for it (and it's not that bad), a foreclosed home can be a really great deal . . . no surprise that approximately one-third of all the properties sold locally are foreclosures.