Home Buying in 87107>Question Details

Nmbuyer, Home Buyer in 87107

Home for sale for 159,000 needs major remodel, sold for 70,000 less 10 years ago and seller has made no improvements. Is 120,000 too low?

Asked by Nmbuyer, 87107 Sun Sep 12, 2010

Roof, floor, stucco, plumbing, electrical, windows need to be done asap. Two extra rooms were built on with no permit and roof is caving in on one of them.

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Answers

8
You should not be looking at what someone paid for a property when calculating what you want to offer. The only factor that really matters is what it is worth in todays market in the ocndition it is currently in. You need to assess what the house is worth in todays market. if you are experienced you can do it yourself or you can simply have an agent complete a broker price opinion. Once you know what the house is worth in todays market, you can make an educated offer.

if you are not experienced, You may want to hire a buyer broker, you can usually do so at no cost to you, they get paid their commission from the fee advertsised in MLS by the listing agent and paid at closing.

Good luck with your offer.
1 vote Thank Flag Link Mon Sep 13, 2010
What the home sold for 10 years ago has nothing to do with current market value.

Value is dependent upon LOCAL market conditions. Why not call a local Realtor to assist? It costs you nothing - and you can get professional advice and information in order to make an informed decision on what the offer amount should be.

Good Luck!

Gerry Dunn
Associate Broker
Licensed in Maryland, Virginia and D.C.

301-651-8600
1 vote Thank Flag Link Mon Sep 13, 2010
Purchasing a home in this condition raises lots of concerns for a lender. Lynn911 from Dallas mentions below that it's important to have the cash for repairs and that NO Lender would approve without the roof being repaired.

As a mortgage lender, I can tell you that on an owner occupied residence, there are some programs still available for a purchase / construction rehab type deal. You will need a 10-20% down payment based off the after repair value & credit worthiness. It sounds like your scenario may fit that bill. If you plan on living in the home and want more information, I'm happy to help.

Joshua Christensen
Southwest Funding - Integrity
(505) 250-1944
0 votes Thank Flag Link Wed Sep 22, 2010
WOW sounds as though city needs to be involved prior to anything money tendered move forward with purchase due to permits and roof

UNLESS cash offer no lender would approve loan unless roof is repaired, questionable about the permits.

Sounds like a headache recommend move forward search for another home UNLESS you have plenty cash out of your pocket do all required repairs

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
972-699-9111
http://www.lynn911.com
0 votes Thank Flag Link Mon Sep 13, 2010
You and/or your realtor need to determine what the estimated value of this home would be with the improvements you list. Then estimate the cost of repairs.From comparable sales in the area see if you can determine what a fair price for this house should be in "as is" condition. The unpermited rooms will be a problem because the city can ask that they be torn down or taken apart enough to determine if proper building codes were met. Might be a good one to walk away from, I have flipped many homes, this does not sound like to good a prospect.
0 votes Thank Flag Link Mon Sep 13, 2010
Post the address and I will give you valuable data to help make your decision....based on what it will be worth after you fix it up and the costs to do those repairs. But I can tell you that what they paid 10 yrs ago has no bearing on today's valuation. You can post it here or email, text or call me. I can give you lots more detail through direct contact only because I am limited in what I can post on a forum like this. I can give you all the information you need to handle negotiations on this one... though your agent should be doing this... and if you don't have an agent, you should... as a buyer it will cost you little to nothing, depending on the circumstances (usually nothing)... I am happy to help though, with no cost or obligation!
David
0 votes Thank Flag Link Mon Sep 13, 2010
All of the information you hae provided is relevent to your final decision as to whether or not to make an offer on this property. However, the true value of this home is most relevent to the local market activity in this area for similar momes.

Our recommendation is to place some importance upon the activity in the local market before factoring in the property's personal appeal. An offer of $120,000 would be most feasible if you were able to support it with solid information that you can present to the seller with your offer.

Good luck,

Bill
0 votes Thank Flag Link Mon Sep 13, 2010
Nmbuyer,
There is no direct answer anyone here can give you for this. The only answer is to have a knowledgeable agent inspect the home, investigate comparables and tell you what the value range is. The value 10 years ago or 10 months ago are irrelevant to what the value is today based on current data.
If you are not working with a solid agent, find one. If you need a referral, consider NM agents who answer or send me an email and I can recommend a couple to consider.
One more note, with all the non-permitted work that's been done, don't go cheap on inspections. Have it looked over high & low inside & out. My favorite inspector uses infrared technology to find hidden issues. Some inspectors charge more, and it's worth it for a home like you're describing.
Financing will be another issue, make sure you can get a loan for a home in this condition. Talk to your lender about an FHA 203k rehab loan. Best of luck.
0 votes Thank Flag Link Mon Sep 13, 2010
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