what are the pros & cons of buying a home w/an agent vs buying through sheriff's sale?

Answer 1

When you buy a house from the Sheriff aka a foreclosure your buying as is. So whatever is wrong with it (termites, flood damage, etc) will be your responsiblity to get fixed. The upside is that you get the property at a super cheap price but unless your a carpenter or construction guy you may end up spending most of the money you save on fixing the property.

Answer 2

Sheriff's sale will probably be cheaper, I'm not sure that you'll be able to actually see the property before you bid on it, and you'll run into a chance that the previous dweller (upon knowing they were going to lose said house) might have trashed the inside of the house.

If you go through an agent, or look on your own, you'll actually have a better idea of what you'd be getting into.

Answer 3

sheriffs sale 20 percent is required...
immediately.... before you consider a sheriffs sale ... are there any liens or judgments on the home... how many???? you can actually wind up paying what would you thru an agent as you would thru a sheriffs sale... these arent easy to purchase.. any good deal the real estate agents and the contractors will be all over them.. do your homework.... if you do make a bid seriously know what your doing...... good luck

Answer 4

At Sheriff's sale: You take "as is" with generally no chance to inspect for condition; You need to pay all cash up front on the day of or soon after the bid; you may have to eject the occupants. Buying houses at auction is not for novices.

Answer 5

How to value a property during market downturn?

Housing market continues to slump. Now we can calculate true value of a property easily. As price decline, we don't need to guess and factor in the potential price appreciation while calculating home value. Without the guesswork, figures are more accurate.

Let's use following example:

Today, a typical 15 years old, two bedrooms condo/townhouse is priced around $500,000 and $550,000 in Sunnyvale, California. Rent for similar condo/townhouse is $2000/month.

If you are a home owner, $2,000/month in rent means $20,000 a year in profit ($24,000 per year in rent, minus $4,000 maintenance costs). A $20,000 income is equilevant of owning $400,000 bonds or CDs, because current yield of 30 Years U.S. treasuries are 5% (5% of $400,000 is $20,000). Bank CDs have similiar yields.

In our example, the two bedrooms condo/townhouse is 20% to 25% overpriced. They should be priced at $400,000.

It is interesting to note that if we redo the calculation from buyer's perspective instead of seller's perspective, the figures are even more shocking.

Mortgage payment consists of two parts: mortgage interests and mortgage principal. The interests portion is similar to rent. If you pay interest, it disappears and doesn't add equity to the property. To fully simulate characteristics of renting, we assume buyer will apply for a zero down, interest-only loan.

It turns out that rent of $2000/month is equivelant to mortgage payment of a $340,000 loan at 7.0% APR. And comparing $340,000 loan to $500,000 or $550,000 price tag, from buyer's view, the two bedrooms condo/townhouse is 30% to 35% overpriced.

One may ask, why is there a discrepancy between two perspectives of the buyer and owner?

The discrepancy is a result of 2% differences in interest rate that buyer borrow comparing to yields of bonds and CDs that owners would get. We understand that buyer would always pay more. That is the premium of buying to own. However, looking from home owner's perspective, current housing market is probably 20% to 25% overpriced. We recommand investors to wait for a better entry point.

http://biz.yahoo.com/brn/060909/19463.html

http://money.cnn.com/2006/09/08/real_estate/caught_in_the_bubble/index.htm?postversion=2006090814
http://money.cnn.com/2006/09/05/real_estate/Ofheo_home_prices/index.htm?postversion=2006090514
http://money.cnn.com/2006/08/24/news/economy/newhomes/index.htm
http://money.cnn.com/2006/08/23/news/economy/homesales/index.htm
http://nobubble2006.blogspot.com/

Answer 6

there are none. go for it