The property market is a very dynamic industry that is constantly adapting to meet the demands of buyers and sellers. Over the most recent 12-month period the pendulum has shifted toward a predominately buyers market.
According to the data from FNB Home Loans as much as 25% of properties are put on the market due to financial pressure.
Meaning that the sellers of these homes are struggling to meet the demands of maintaining the mortgage and other costs related to the property.
As a buyer, this situation might look like an excellent opportunity to secure a great deal from a seller in a desperate situation but in reality, there are a few dangers of buying a distressed property:
- Sellers under financial pressure may be less willing or able to negotiate on the price. Often the outstanding bond amount is relatively high, and there may even be some overdue rates bills to settle before the transfer can occur.
- Distressed Sellers are not very flexible on time. They most likely need a quick sale, and they cannot afford the luxury of long delays that can arise in subject-to-sales.
- Sellers facing repossession rarely have the time or even the resources to make necessary repairs or renovations, which could result in additional costs for you as the buyer.
The above are some of the issues to consider about the dangers of buying a distressed property before you even decide to approach a seller with an offer to purchase.
Click here to find a list of bank-repossessed properties in your area or subscribe to your free email newsletter to receive updates directly to your inbox.
Looking for bank repo houses, interested in investing in real estate and keeping up to date on the property market?
Subscribe to our weekly newsletter. 🎯
Leave a Reply