IRVINE, CA-Buying and rehabbing a fixer-upper home comes with a unique set of challenges. According to RealtyTrac, a locally based source of real estate data, both the financing and the construction portions of owning a fixer-upper require readiness and wise decision-making on the part of buyers.
As GlobeSt.com reported earlier today, Daren Blomquist, VP of RealtyTrac, said in a prepared statement, “Low-priced homes are still plentiful in many markets, particularly in the form of foreclosures. While these homes may be in need of more work than a typical home and are certainly harder to find now than in previous years, buyers and investors willing to put in a little extra legwork and sweat equity can often find the best deals in their markets on these foreclosure fixer-uppers.”
For one thing, the real estate agent you choose to help with the buying process of a fixer-upper should be skilled and seasoned, said Rich Cosner, president of Prudential California Realty, in a prepared statement from RealtyTrac. “Select one that works full time in the business and works for a well-known and reputable firm. These are the agents who know where you will find the best possible property.”
A good real estate broker can also recommend where to get a loan for your purchase. “In order to present the best possible offer to the bank owning the home, you will want to have the lender pre-approve you for the loan,” Cosner added. “This is the only way you can compete with cash buyers.”
Be prepared to face stiff competition and act quickly if you're looking for a deal on a fixer-upper, said Emmett Laffey, CEO of Laffey Fine Homes, in the statement. “Be ready to act quicker than you ever have before.” This means being prepared to sign a contract immediately and remove all contingencies since demand for these homes is at an “all-time high” in this market.
“Since prices for bank-owned fixer-uppers are below market, many of the deals are all cash,” Laffey added. “If a buyer is planning to obtain a mortgage, it is wise to waive the mortgage-contingency clause to be considered at all.”
For more information about fixer-uppers, RealtyTrac has also released its “7 Tips for Finding, Financing and Fixing Beat-Up Foreclosures.”
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Carrie Rossenfeld
Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.
