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A Brand New Home or Buy an Idaho Foreclosured Property

Main Idaho Real Estate Insights
A common misconception among Idaho home buyers is the idea that the best home values in today's real estate market are foreclosures? There are some good deals on homes in foreclosure, for many buyers, but buying a new home is actually the better value most of the time.

Boise Idaho New Homes

What makes buying a new home a better value?

Boise Idaho Foreclosure Real estateFor starters, when you purchase a new home you are protected by a warranty. If anything goes wrong, the home is covered by a credible builder's minnimum one-year limited warranty on workmanship and materials, as well as a structural warranty. You will have peace of mind knowing there won't be any unanticipated out-of-pocket repair costs to absorb. Additionally, everything is new from paint ot shingles and even mechanicals like the AC unit which may also be more efficient than your current HVAC system.

If you're after a quick response to your offer, a new home is a smart way to go. In most cases, you're dealing directly with the builder, which ensures a prompt reply. If the home is ready for occupancy, you can also count on closing escrow in a timely manner.

Of course, the ultimate benefit of buying new is having the opportunity to purchase your dream home. You are the first owner and everything is pristine, sparkling, and brand new. In many cases you'll be able to customize the home, selecting items like cabinetry, countertops, and flooring. Rather than making due with someone else's choices, you have the advantage of living in a home and a neighborhood that truly reflects your taste, lifestyle and personality.

Are you prepared to roll the dice on a foreclosure?

Most home buyers don't realize there are risks associated with buying a foreclosure. Perhaps the biggest concern for any potential buyer should be the fact that properties in foreclosure are sold "as is." This means there's no warranty protection.

Conventional sales on new or resale homes require full disclosure of any details or drawbacks on the property. The seller can be held liable if a problem arises as a result of an issue that wasn't fully disclosed at the time of the sale. With Idaho foreclosures, it's always "let the buyer be ware." When you buy a foreclosure you have no recourse against the seller if there are construction defects, environmental hazards, or problems of any kind with the home.

Additionally, when you purchase a foreclosure you can't always be sure of the condition of the home is "good?" Many homeowners stop taking care of the property when they realize they will be losing the home. Sometimes, maintenance issues are not immediately visible until someone starts living there. For example, having the water turned off for a long period of time can result in problems with seals and plumbing fixtures throughout the home. This can cost the current home owner out of pocket to bring the home up to an acceptable standard of living.

Then there's the issue of price. You may be surprised to discover that the below market listing price is not what the property actually sells for. Foreclosure properties often attract multiple offers, with professional investors stepping in and bidding up the prices of many below-market foreclosure listings. What initially looks like an incredible deal ends up selling at a significantly higher price. Keep in mind that many foreclosure properties may also require a substantial additional investment after the sale to replace damaged fixtures, missing appliances, stained or worn-out carpets and dead landscaping.

What about short sales?

A short sale occurs when homeowners who want to avoid bankruptcy or foreclosure proceedings gain lender approval to sell the home for less than they owe. In a short sale situation, you are at the mercy of the lender. Even if the owner accepts your offer, the lender has the final say. Obtaining lender approval is a time consuming process, which can take upwards of thirty to sixty days. Short sales require patience and may result in disappointment since lenders frequently reject offers that are below market value.

The bottom line is peace of mind

The reality is it's a great time to be a homebuyer. Prices are down, interest rates are extremely attractive, and the selection of available homes couldn't be better. If you're a risk taker, a foreclosure or even a short sale could be right for you. For the rest of us, Burton concludes, "When making an investment as significant as a home purchase, the bottom line is peace of mind." Buying a new home from a trusted builder in today's market promises the best of both worlds-outstanding value and peace of mind.

Posted by tlangford at 4/23/2012 3:00:00 AM

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