One of the best ways to buy a home, particularly a first home, at a significant discount is to buy it at a trustee’s sale. These sales occur a few times a month in Cedar City, and they often include nice homes at a reduced price. Typically, the bank or company that owns the title of the home will set the auction price somewhere around the amount still owed to them. Because of this, the opening bid could be tens of thousands dollars less than current market value. In other words, you could potentially buy a home at a major discount.
There Are Significant Risks Involved with Purchasing a Foreclosure
While you may be getting a big discount at a foreclosure auction, that winning bid may be deceiving. There are potentially big risks involved in purchasing a foreclosure. Quite often people bidding on the home have no access to it, and there is usually not any comprehensive information available on the home. The auctions are presented with these risks involved. In many cases, you may not even be able to look at the interior of the home before you make a bid. Also, measuring the Cedar City real estate market requires professional analysis. For example, a manufactured home in Cedar City that’s being foreclosed upon may be a good or bad deal based on where it’s located. If it is located in town or on 20 acres out west of town can fluctuate values dramatically, which in turn can change whether or not it’s worth buying at foreclosure. The diversity in the types of properties in Cedar City, particularly with in-town property versus rural areas, makes the investing landscape more complex than in other places.
An Agent Can Help You Mitigate the Risks When Buying a Foreclosure
A local agent who has been involved in purchasing foreclosures before can help you minimize your investing risk at these auctions. While it may not be possible to see a home prior to bidding at auction, an agent will likely have seen the previous listings of the home you are bidding on. It’s quite often the case that homeowners who are about to go in foreclosure try to sell their home before that happens. It’s very possible an agent you want to work with will have seen or shown the home to clients before it went into foreclosure. Even if an agent you are considering hiring hasn’t personally seen the home, he or she likely has colleagues who have, which mean he or she can get professional opinions about the home for you from other agents.
Getting access to as much information about a foreclosure property is critical to avoid investment blunders. Some foreclosures have major problems, whether structural or cosmetic. A good agent is informed and connected, which means he or she can get you all of the information you need to bid at auction, as well as provide accurate market analysis. Understanding the Cedar City market isn’t easy to do, and that’s why an experience agent is a great asset when making these types of investments.