The crash of the housing market resulted to a flood of foreclosures which in turn sent home prices spiraling downward to their lowest level.
According to RealtyTrac data, a total of 290,631 houses received auction notice or default or were repossessed by lenders in February 2009.
In North Texas, hundreds of foreclosure listings homes will be auctioned off. This could be a chance for first-time homebuyers to purchase the house of their dream at a lower price and investors to venture into the foreclosure market.
Data from the National Association of Realtors showed that foreclosure listings sales accounted for about 45 percent of real estate transactions in the last quarter of 2008. This development contributed to the drastic decline in home prices nationally.
Real estate experts believed that potential homebuyers play a role in stabilizing the housing market and streamlining the number of houses in foreclosure listings. Potential homebuyers can help pare the growing foreclosure listings of abandoned and vacant homes as the Obama Administration push through with its foreclosure prevention plan.
Harvard University’s Joint Center for Housing Studies executive director Eric Belsky noted the importance of recycling foreclosure listings houses into productive use such as living in them, improving or upgrading them or renting them out.
For homebuyers who want to live in real estate owned (REO) properties they acquired, they can buy directly from financial institutions that have already foreclosed on properties.
However, experts cautioned that purchasing foreclosure listings houses or arranging a property sale between homeowners and their lenders do not guarantee bargain prices.
California Mortgage broker Mark Goldman pointed out that foreclosure listings homes are not necessarily good buy deals. He urged potential homebuyers to carefully consider and evaluate market values of foreclosed properties before shedding out any dollar.
Several factors that potential homebuyers should consider when buying foreclosure listings homes:
- Foreclosed properties in auctions are sold as is, with majority of them requiring major repair or rehabilitation.
- Buying foreclosure homes from banks can be a tedious process. This goes true with major lending institutions with a large inventory of distressed properties.
- In some areas, home prices are not a bargain because multiple bidders have made offer for the property. This will result in higher market prices and there is no assurance that potential homebuyers would recover the total amount they paid for the said property.
Several websites are available to help potential homebuyers choose and buy from foreclosure listing properties, including ForeclosurePoint and RealtyTrac.
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- Lots of Low-Priced Housing Options on Repo List
- Buyers Tour Florida Foreclosed Homes on a Boat
- Foreclosure Listings Will Continue to Favor Homebuyers
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