Rick Johnston

Pat, thanks for your thoughtful insights. I was really referring to the actual foreclosure sale itself on the courthouse steps, where the lender can simply bid the mortgage amount to take title to the property. I certainly agree that they don't want to own the property, but I find they almost always list the property with a broker at that point. - Fri May 30 2008, 07:22

My guess is that short sales will produce slightly better value for the buyer than buying bank REO property. Short sales are far more of a crap shoot, but there is generally less buyer competition for these properties because of the hassle factor. Bank's make lousy investors of real estate, and could sell a property below market just to get it off its REO list. A bank owned property listed with a realtor will likely generate more buyer interest, and therefore a better price. - Sat May 24 2008, 17:09

Its very difficult to break even purchasing single family homes for rent, and get a reasonable "cash on cash" return on your investment. To do so, you really need the price to be about 10 times annual rent, which is hard to get even in this soft market. In this country there are big tax incentives for home ownership (capital gains breaks, mortgage interest deduction), which inflates the prices of residential units for home ownership. - Sat May 24 2008, 17:01

Radon can be found virtually anywhere, and especially in the eastern U.S. 4 pCi/L is the EPA standard, but frankly no one really has a good sense of what exposure at what levels causes health problems.

A remediation system would help the value of the house, or in other words radon without a remediation system would cause the value to drop a little. Usually, remediation systems are not that expensive, and usually involve venting the radon gas. Radon is a very heavy gas, yet with ventilation can be dispersed easily. Testing in different places (especially the height of the sensor), or testing in places where doors remain open or closed, has a huge effect on the testing results.

It also matters where you find the radon... its much more of a problem in a bedroom than it is in a basement storage closet. - Sat May 24 2008, 16:53

By asking this question you are already down the wrong path. You assume that the seller has a clue what the property is worth, which may or may not be true. Take the best three comparable sales that have taken place, and make the case why your offer is competitive. - Wed Apr 30 2008, 12:28