Are Those Under Market Value Home Prices Real or Fake?

Are Those Under Market Value Home Prices Real or Fake?

Question: Are Those Under Market Value Home Prices Real or Fake?

A reader asks: "I'm finding a lot of homes on the market that are advertised at really low prices. However, when I tried to buy a home with a low price tag, the seller refused to accept my offer. Can they do that? Are those really low home prices for real or fake?"

Answer: Under-market-value home prices should raise a red flag. Here's the million-dollar question: Is the under-market-value home price real or fake? In markets that experience a huge and sudden influx of foreclosures, it's hard to tell. Part of the problem is banks sometimes underprice deliberately. But there's more to those artificially low prices that appear to be under market value.

Types of Under Market Value Home Prices

In any given market at any time of the year, you're likely to find home prices that sound too good to be true. Before you jump on these under-market-home prices, ask your agent to help you to understand why those homes are priced so low. What types of under-market-value homes are those? Let's take a look:

... and the reason I'm looking forward to...

Homes in Bad Locations
You can't fix a bad location. You can fix functional obsolescence, but you ordinarily can't move a home from its spot. If it's next to the freeway, a landfill or a commercial zone, you're pretty much stuck with its location. Remember: location, location, location.

If the price is below market value when you buy such a home, when it comes time to sell, you, too, will need to price it below market value to get it sold. Anything will eventually sell if it's priced low enough.


http://homebuying.about.com/od/buyingahome/f/071608_lowprice.htm

I'm just happy the homes prices in my neighborhood didn't drop much. We lost about 30 grand off the price we paid, but we're in a central location and the market should bounce back here in the next couple of years. Plus, I like my home. I've put in a patio, painted the walls, and basically made it into my castle. Now if I can just get the kid to leave, it'll be heaven.

There's so many properties for sale in rural Wisconsin, I can't hardly pick. One thing I do know, I'm going to have to move back there and rent some place first just so I can go look at all the different places. There's this movement of people out of the country to in town. They want to be closer to work, stores, friends, whatever, but that's good for buyers like me. I want a place in the country. I don't work so who cares about a commute. I want freagin' privacy. If possible, I don't want to even see any neighbors, and there lots of properties like that opening up in Wisconsin, and they're going for pennies on the dollar. I can't wait. It's been going on eight years since I owned my own home, and this apartment living is just about driven me insane.