Buying homes from the bank saves money, but not time
It's a drawn out, frustrating process, but if you're willing to put in the time, buying a home from a bank can save you a lot of money. Seattle-area real estate appraiser Richard Hagar tells KPLU's John Maynard that while it is mostly investors who seek out these properties, average home buyers can score great deals, too
Hagar says it's a good idea to seek out real estate agents who specialize in these type of sales since they can be long on paperwork and procedure. He also says buyers looking for distressed bank properties can find foreclosed homes for sale listed by city and state on the Fannie Mae (Federal National Mortgage Association) and the Freddie Mac (Federal Home Loan Mortgage Corporation) websites.
The big appeal, he says is a much lower price compared to average housing stock. He points to Arizona as an extreme example of this:
"In Scottsdale, foreclosed condo units are selling for $15,000 to $20,000. These are units you can rent out for $600 to $800 a month. Five years ago, the same units were selling for $150,000. In Washington state, it's not as extreme – more like 50 cents on the dollar here compared to what they were at the peak of the housing market."
Still, Hagar warns that you won't be able to rush the process. But if you're able to ride it out, he says you can get a "smokin' deal."
“Street Cents” is a monthly feature exploring real estate trends in the Northwest. The feature is published here and airs on KPLU 88.5 on the first Tuesday of the month during Morning Edition, All Things Considered and on Weekend Saturday Edition.