So the house is priced 20k under its worth (at least, what it’s taxed at). Sounds like a good deal to me…but what should I watch out for? Here’s a list of things I’ve thought of:
Leaky roof
Bad furnace
Cracked foundation
Termites/roaches/etc
Mold
Tax liens, (other unseen payments?)
If I bought a house, I get a free house inspection from the VA, so that takes care of the physical stuff. How do I check for other traps (that I might just be making up)? I live in this neighborhood (have my whole life) but I haven’t gotten the chance to look at this house yet, so I can’t tell you anything other than what those two sites say.
I’m focused on that last house, but feel free to offer advice on two other homes. (ML # - 681364 and 677786)
There is a place near where I live, that is right on the water, and it is very picturesque. Every winter the houses in this area go on sale, all at great prices and the new families all move in, excited about the bargain they got the house for.
Then spring and summer arrive and with it the lovely odors rising from the seagrass (supposedly–my take is that the septics in the area have huge issues). And that is exactly what the area smells like–a large septic field.
So the season passes, and then the next winter all those houses go on sale again and a new series of nice young families move in and the cycle repeats.
So tread lightly–remember it is cheap for a reason. You just need to flush out that reason.
I suggest asking every single one of the neighbors. Next door, across the streeet, even the guys who own the properties BEHIND that property.
There’s a little old lady living one door down who has been in her house since 1948, when my tract was flipping built. She knows more about the work that’s been done on mine than I do.
Never know what some detective work will turn up.
Might try calling your area’s permits/construction office. Also try the courthouse.
We have one in our neighborhood that gets shot at because the shooters don’t realize the previous owner has moved. Nice neighborhood - weird situation - previous owner was apparently on the wrong side during the Vietnam war and our local Hmong population still has it in for him (he’s in his fifties) - it isn’t like this is the local meth lab.
Well, note that the county website says taxes have been payed for every year since 2004, with the last payment having been made on March 3. Does that mean there’s no tax liabilities I’d be buying with the property? I’m not very savvy on such things (yet).
Let’s assume it’s in foreclosure. What’s that mean to me? That the owners just need their money, fast? I checked the neighbor’s houses…they all bought for thousands under the taxed value too. What’s that mean, then?
Not all former owners of foreclosed houses will go quietly. Some of them will vandalize the house in various ways on the theory that, if they can’t have it, nobody else should either. Some of them will refuse to leave the house, and then you as a new owner have to get them out of there.
It might indicate that the value of the house won’t go up as fast as you might like. Some people get into financial trouble as homeowners not because they lose a job or something like that, but because they have an adjustable-rate mortgage, then when interest rates go up, their payments go up but the value of the house isn’t going up fast enough (or even goes down), so it’s hard to refinance.
We have one in our neighborhood that gets shot at because the shooters don’t realize the previous owner has moved. Nice neighborhood - weird situation - previous owner was apparently on the wrong side during the Vietnam war and our local Hmong population still has it in for him (he’s in his fifties) - it isn’t like this is the local meth lab.
Maybe they did do it in 2006 (though ISTR our realtor saying something about assessments in Pittsburgh not being done too recently). If they did, then I’d really worry about what could make the prices drop that far that fast.
A chat with a realtor who is familiar with the neighborhood is probably in order. Find a good realtor who isn’t into the hard-sell approach (I had a good experience in Pittsburgh with Howard Hanna), and ask him or her why the houses around there are selling for so much less than their value as assessed by the county.
My email is in my profile, if you want to PM me and get the name of our realtor- if she doesn’t handle that area, she might know someone who does.
The inspection should take care of any of those problems, other than tax liens. If you don’t trust the VA inspection, pay $300 for a regular home inspection and see what they say.
You should do a search for clear title, which would cover tax liens and any other liens before you complete the sale.
The only thing I can see that you might need to be worried about that wouldn’t be found would be if the house was haunted, or people living there tend to be abducted by aliens, but the neighbors might have some input on that.
You might want to insist that a Home Owner’s Warranty be included with the sale, which would cover any problems minus a small deductible (I didn’t renew my H.O.W. and ended up having to have $2500 worth of work done on the septic tank a few months after it expired…would’ve been worth the $400 to get another years coverage).
You’ve indeed thought of some good trouble spots to look for, but why rely on yourself? This is why sellers have to provide disclosures, and disclosures can be incomplete, which is why you can make a contract contingent upon a satisfactory inspection by a qualified inspector. (And hire the inspector who wears coveralls and will get dirty, not one in a tie and khakis).
In my experience water is the thing to look for, everything from which way the drainage goes around the exterior of the house, to signs of roofs leaking, to signs of pipes leaking behind the walls or under the floors. Get under the basement/crawlspace and see whether it’s wet or dry; if wet, that could be a warning sign.
It could also be just that it’s a nice house with very nice owners who got a very nice job offer in a nice state far, far, away. That’s what happened with our house, we ended up “inheriting” a brand new $50,000 kitchen renovation job virtually for free because the owners got an out-of-state job offer that they couldn’t refuse.
Having a clear title basically means that it’s clear you’re the only one who has title to the property.
These are good questions but there’s no need for you to re-invent the home-buying wheel. Talk to a realtor (or two), and start looking this stuff up on Google.
My original home is in rural PA and one of the primary problems with homes in midwestern PA is that they were built at the turn of the 20th century or earlier and have never been renovated or upgraded. That means that your electric configuration will be totally inadequate for today’s needs. You may even have a room or two without an outlet. The bathroom was probably moved indoors in the 40’s or 50’s over the kitchen and one “bedroom” may be an open area at the top of the stairs.
The best thing you could probably do with this house is tear it down. That’s why it’s so cheap.
Sorry for the multiple replies, but I just noticed this comment. The VA is a great program for first time buyers but beware that they can add extra loops to that roller-coaster we call homebuying. Since they are guaranteeing your loan, and your loan is guaranteed by the house, they will go over the inspection report with a magnifying glass and will not hesitate to demand that somebody fix any dribble, chip, or stain that they get spooked about. After all, if you blow town, it’s THEIR house. So my advice is, don’t take the free VA inspection if you can help it. Hire your own if you can. When you get your super sharp A-1 home inspector, arrange to go through the house with him/her at inspection time. They should of course write down the true defects. Ask them if they will just verbally tell you about minor defects, cosmetic issues, and their own personal philosophy about the best way to maintain granite countertops. This way you won’t have the VA saying “fix the 1 inch rain spot in the attic or we won’t give you your guarantee letter for closing.”
I took the address from the realtor site and looked it up in the county database. I got the owner’s name from there and looked up his other property. Turns out he owns 6 places, all not in very good shape. Taxes were late on at least one. I googled his name. Turns out he’s bankrupt as of May '06. He’s selling this house for $9,900- guess how much he owes in taxes! ~$9,000. I got all this info while sitting at a desk in Tampa, FL. I love the internet.
