If you are buying a bank-owned property (meaning no one bid over the amount owed on the property and the title went to the lender) then it is usually eligible for a conventional loan (at least) and the buyer can hire an inspector to evaluate the property prior to purchase. The bank will not make any repairs, but might allow for deductions from the purchase price for substantial, needed repairs that come up during inspection.
A lot of foreclosed homes were flipped between 2005-2007, and wouldn't really be much different from more recently flipped homes or any other home. The bigger problem would be lack of upkeep from time of default to foreclosure, but that's usually more cosmetic than not. In some cases you could get intentional acts of vandalism or removal of appliances, fixtures, cabinets, etc. by angry defaulters. If the property has been empty for a while there can also be squatters.
If I were you, I'd look more into probate sales or just regular fixers. With all the get-rich quick flippers, you need to be fast, but there are properties that simply haven't been updated in a while that do come on to market.
I'm a Realtor in Sacramento but I recently referred a SF client of mine to a local real estate agent in SF. She did a fantastic job and helped my clients find and then buy a house 2 weeks ago in SF. They submitted several offers on other houses and every time the house sold for way more than list price. The housing market is red hot in SF! If you like, I can forward her contact information to you. She specializes in SF and is very successful.
A tip: when submitting an offer on a house, I recommend my clients write a letter to the seller about why you want to buy the house. I also have them include a brief description about themselves so the sellers know a bit about them. This helps draw some emotion to the sale. Otherwise you're just a name on an offer :) Hope that helps!
REALTORÂ® - lic #01923240
Certified Public Accountant (CPA) - lic #103885
Hammer Real Estate Group
Foreclosures are far and few between in San Francisco and they sell in a competitive market and generally as-is. Therefore they must be evaluated on a property by property basis, just like any other property.
Feel free to contact me to find out more about foreclosure purchases and how they are sold. Once you know that information, you will be in a position to intelligently assess whether foreclosures are right for you in general. That is before even finding any foreclosure opportunities.
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Flavio Tejada, Owner/Broker, Realtor, MBA-Finance
You've listed a couple of options you're considering, a foreclosure and an "inexpensive property" that may require "extensive remodel" in the Sunset/Parkside (or West Portal, etc). All things being equal, San Francisco and "inexpensive" go together like water and oil, pun intended, and the type of purchases you're considering have built in issues that may not lend themselves to the best of financing options by their very definition.
Typically a house needing extensive remodeling connotes a "fixer", unless you're buying a run-of-the-mill "row house" of a certain era in these areas, e.g., 1930's vintage. Such a house will meet a lender's standard underwriting guidelines, unless it is a true "fixer" (a house needing repairs because of poor maintenance or economic obsolescence). However, consider the other given in this scenario -- the competition.
The reason for prices being high (definitely not inexpensive when you're evaluating a price upwards of $800,000), is that there is a pent up demand for houses in most parts of The City. As such, you will be in competition for the best case scenarios in either "types" of houses being considered, and, the better the floor layout, or appeal of the design of the house you're scoped out, the more you may expect to have to pay (in a competitive bidding war -- a probable result in either foreclosure or house needing upgrades). I can tell you about one such house, 144 Sadowa St., San Francisco, that when the dust settled on the numerous offers that were fielded, the price went from $199,000 all the way to $434,000! (to illustrate this buying frenzy).
For all that you intend on doing, be prepared to pay more than you thought -- to buy and to fix, and for the privilege (financing is pricier if the property is a fixer).
J. Mario Preza
Foreclosures are becoming a rarity in the Sunset/ Parkside. Home prices have gone up so high that it is impossible to find a foreclosed one in The area. I specialize in the Sunset and would be happy to be of help to you.
My questions to you are? How big of a house, what areas of the Sunset? How much are you willing to spend to buy the house? Have you done some extensive remodeling as the building department in San Francisco has many requirements. I have several clients in the area that have done extensive remodeling. You are welcome to come visit their projects.
2633 Ocean Ave
San Francisco, Ca 94132
Just because the property is a foreclosure doesn't mean that it's in horrible condition. There are foreclosed properties that need a great deal of work, while others need only cosmetic repairs. The same goes for properties that are categorized as regular sales.
I've seen regular sale properties that need much more work than a foreclosed one. For example, mold, foundation issues, water damage, termites of all sorts.
A foreclosure just means that the homeowners rights to a property are forfeited because of failure to pay the mortgage.
If you're looking for a property under a million, I have a single family attached in the Richmond district of San Francisco on 35th by Geary. Great great neighborhood. Other properties in the area which have been remodeled are selling for around 1.3 to 1.5 mil. It's a private sale - good property that needs updating. Call me if you're interested!!!
Hope this helps.
Wishing you all the best,