The real estate market today is full of some great bargains. While the slump in the economy is difficult for homeowners, it is a buyer’s paradise when looking for a new home. Yet even with the deflated prices on property, some people still want to find the best home at the cheapest price. So if you are in the market, you might be wondering where to find cheap homes for sale. There are lots of ways to save money when buying a home.
Don’t Go For New
If you are looking at buying a home but you want to save money, don’t buy a brand new home. Property developers are not likely going to come down on their prices. The house and all of its materials are brand new, in good condition, and will bring top dollar on the current market. Also, there will likely be plenty of interested buyers who want that instant home with everything new. So there will be no need for the developer to negotiate price.
Real Estate Agent
One thing you can do to help you find a cheap home is to hire a real estate agent to do the looking for you. They know the current market, they will have access to all the homes for sale in the area, and can act on your behalf to negotiate a good price. You can give the realtor the specifications of what you are looking for, including square footage and price, and see what they turn up with.
The drawback is that you have to pay the realtor which means less money left in your pocket. Since realtors usually get a commission from the sale, watch out for realtors that try to push higher-priced homes on you.
Foreclosures
Foreclosures are bad for homeowners but good for buyers. Homes that have been foreclosed by a bank will often be sold at a big discount as the financial lender tries to recover part of their investment. You can often find foreclosure listings in your local newspaper, shopper guides, real estate trades, and the internet. There are several sites on the web that list foreclosed homes in each state. Realtor’s are also going to know which homes have been foreclosed.
Sale By Owner
When dealing with real estate agents, you have to figure that the price of the home will be increased enough to pay for the realtor’s services. Often times this may put the home at slightly above market price.
When looking for cheap homes for sale, check out the ones that are being sold by the homeowners themselves. Dealing directly with the owners cuts out the middleman and you are more likely to get a better deal. The homeowner will usually be more willing to negotiate a better price. A good way to find these homes is to drive around and look for sale signs that do not have a realtor listed or you can check the local newspapers.
Cheaper Neighborhoods
Neighborhoods full of brand new homes are the wrong place to look for a bargain. The property values in these areas will be at their peak. If you want a cheaper home, go look at an older neighborhood. The property values should not be as high and the surrounding properties, if they are not in pristine shape, will affect the sale price. If a neighbor’s fence is falling down or a nearby home needs a new roof, these factors can help bring the price down a little more.
Fixer Uppers
Cheaper neighborhoods brings up the best option for finding cheap homes; the fixer upper. Fixer Uppers have long been the go-to house for buyers looking for a cheap deal. These are homes that have some defects and need a little work. There might be paint peeling on the garage door or some plumbing problems that need to be addressed. Any little defect can affect the price and give you a better bargaining position.
However, when looking for homes that need some work, know what you are getting yourself into. Be prepared for the additional cost of getting them repaired. If you can do the work yourself, then you save that much more money. However, if you have to hire it done, consider the cost of labor. Plus, some homes may have more problems than you might think. A home that is in really bad shape can end up costing you more to get it fixed than you saved in the first place.
Comparison Shop
Shopping for a home is just like shopping for anything else. If you want the best price, you shouldn’t set your sights on the first home you come across. Always shop around. Get some quotes from several different homes and compare them. Look at what each home has to offer that might make it a better bargain. The cheapest home may not be the best home. One home with less square footage may have a deck or a larger yard.
Think about what you need in a home. If a home doesn’t have what you need, then disregard it. If a home has too many things that you will not use enough to justify the price, then disregard it as well.
Negotiate
By now you have found a cheap home that you are interested in and it is time to negotiate. This may be the most critical part of buying a home. Never offer exactly what the seller is asking. Even if there is a lot of interest in the home from other buyers, you are still looking for a bargain, right.
Go under the asking price but try to stay above the next highest buyer. Of course, you may not know what the next highest buyer’s offer is but if you go through a realtor, you might ask them.
If the house has been sitting on the market for awhile, you should offer even less. The chances are that they longer the house goes unsold, the more desperate the seller will be to get rid of it. This is especially true of owners who do not live in the home being sold. Which brings us to the next point.
Second homes, which are homes that are not the owner’s primary residence, often go for cheaper prices. Why? Home owners that sell their primary residence will often need a good price in order to buy their next home. For a secondary home, there is no pressure to get as high of a price as possible. The owner already has a place to live. This is not always true but many times you can get a better price if no one is living in the house.