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The real estate market has taken a hard hit because of the recession. The result has been a buyer’s market. The real estate market can be confusing to navigate through because of the jargon and the legalities involved. However, anyone can learn what it takes to becoming a bargain home buyer in the midst of a recession. Here’s a quick rundown about what the real estate market is all about right now.
What are distressed sales?
A distressed sale occurs under negative conditions. It is an urgent sale of assets where a loss generally occurs.
There are three major types of distressed sales: foreclosures, short sales and real estate owned (REO). A foreclosure occurs when the owner has stopped making payments on the home and it goes up for auction by the lender. A short sale is when the home owner is in the midst of foreclosure, but sells before the property ever goes on the auction block. An REO is nearly the same as a short sale, except the property has been picked up by the lender.
What about fixer uppers?
Fixer uppers are generally the lowest costing homes on the list. However, fixer uppers generally require time, energy and money to restore it back to new. Fixer uppers have its advantages, such as lower prices, less competition and potential for profit during resale. However, there are also disadvantages. For example, you may deal with homes that require totally interior reconstruction all due to a previous owner’s "foreclosure rage."
Is there general advice to buying a home?
Although it may seem like a real estate cliché, it’s all about "location, location, location." When purchasing a home, you’re also considering how it would eventually sell when the time comes. Look for a home that has a great community and great convenience. A nice view doesn’t hurt either.
