Should you consider foreclosures when buying a home in Atlanta, GA?
If buying a home in Atlanta is in your future plans you may have considered looking at Atlanta foreclosures as an option. Buying a foreclosure has become a popular option in recent years because of the sheer numbers of foreclosures on the market. The financial crisis the United States has muddled through over the past several years has caused the foreclosure rates to reach historic highs in many markets. While this is certainly bad news for those who lost their home during the recession, it can be good news for anyone who plans on buying a home in the near future.
Atlanta, like many major metropolitan areas, was hit hard by the housing market crash; however, the Atlanta market appears to be on the rebound finally. For the 12 month period ending in April of 2013, 46,775 homes completed the foreclosure process in Georgia. At that time, just under two percent (1.9 percent) of the total inventory of available properties were foreclosures, reflecting a 0.5 percent decrease from that same time in 2012. Atlanta’s foreclosure market was slightly worse than the state as a whole with foreclosures representing 2.1 percent of total inventory. Though the inventory figures remain high overall, they continue to decrease. Moreover, with a national average of 2.8 percent, the Georgia market appears healthier than the national market as a whole.
If you are looking at Atlanta foreclosures as an option for your home purchase it is important to understand how buying a foreclosure differs from buying a home in a traditional sale. Overall, the process is the same; however, there are some important differences in the details, including:
· Determining Value – unlike a private owner sale, the price a foreclosure home is listed for may, or may not, bear much resemblance to the fair market value of the home. The bank may list the home for its “rock bottom price”; however, if the market values the home higher, then it could easily sell for considerably above the listed price. On the other hand, you might be able to purchase the home at a lower price than what is listed. Working with a real estate professional to determine a property’s market value is crucial before making an offer.
· Negotiating – negotiating a sale is often different with a foreclosure. In fact, there may be no actual negotiating. The bank often does not submit a counter-offer, making it even more important to know the value of the home prior to submitting an offer. Unlike a traditional sale where the buyer usually “low balls” the first offer, you are often best to simply offer your top price with a foreclosure or you could lose the home because the bank won’t negotiate.
· Time Frame – purchasing a foreclosure doesn't necessarily take much longer than a traditional home sale, however, a short sale is known to can take much longer to purchase than a traditional sale. Typically, a buyer purchasing a short sale may have to wait for weeks to hear back. As the process of purchasing a distressed property is different from a traditional home purchase, you want to make sure that you or the person you are working with is familiar with the process.
· Condition – a foreclosure property is sold “as is”. Considering the fact that the previous owners were obviously facing financial problems, and likely not happy about the foreclosure, it is wise to assume that the property will need repairs. Estimating the cost of those repairs is a key factor when making an offer.
· Finding Properties – some foreclosures sit on the market for months while others are snapped up within hours of hitting the market. Working with an agent who is familiar with Atlanta foreclosures is essential if you are considering the purchase of a foreclosed property.
By working closely with an experienced real estate professional you can locate and purchase an Atlanta property at a very good price, making the dream of home ownership more attainable.