Friday, September 17, 2010

Buying Cheap Homes

We've all seen and heard the horror stories about the real estate market in Florida. The state that was once the retirement haven of the entire country where people dreamt about having enough retirement savings to move there has now become one of the cheapest places to buy real estate.

Recently the Sun Sentinel presents it's 'Tips on Buying Cheap Homes'. The article begins with the standard disclaimers of knowing exactly what you are doing and what you are getting yourself into when you chose to buy cheap homes. Of course that is particularly true when looking at foreclosures - the best and most popular place to find a cheap home.

Tip #1 - Keep you first buy simple and easy. Don't go for the major over haul - reno project. It could sink you. Start by looking for cheap homes that just need minor repairs, a coat of paint and a good clean up.

Tip#2 - Use your common sense. A deal which brings the cost of a home back to market value after renovations isn't a deal at all. David Dweck of the Boca Real Estate Investment Club suggests you look to keep your total investment to no more than sixty five percent of the market value. So, if the home has a market value of $100,000 after you clean it up than you don't want the total cost of purchase and renos to be more than $65,000.

Tip#3 - Always insist on a home inspection. Remember as you look at cheap homes for sale they are likely sold 'as is'. You need an inspection to know what is hiding and what you're really getting yourself into in terms of prepping it for market.

Tip#4 - Insure you are getting clear title to the property. This means being thorough in your title and lien search. You may need to pay a few outstanding bills but as long as that fits in the 65% total cost scenario your still making a good investment and buying cheap.

Some investors are looking at income properties so that can at a few more steps but essential the same tips apply when it comes to finding cheap rental homes and cheap vacation homes.

Click here for more tips on How to Buy Land Cheap

Source Sun Sentinel: Tips on buying cheap homes

No comments: