Real Estate Investments - Buying Fixer Uppers By Debbie Mason At Isnare.com Ezine Articles

Here we look at whether you should buy a fixer upper property.

The first thing that comes to mind when someone says real estate investment is probably going to be fixer upper. It is no wonder that you may think that way because that is precisely what the investment courses have been selling us for years. We have been taught to buy the ugliest house we can with no money down. We now have the mindset that if the value goes down, at least we have no money invested. This type of thinking could cause you more harm than good in a declining economy.

Buying with no down payment will increase your monthly payments significantly. If you can't rent the property for the cost of the mortgage, you are taking a big loss. Another thing to consider is that if real estate prices are beginning to go down you don't want an ugly house. Here is why that is a bad idea. In a few years or even months if home prices drop quickly enough, people will be able to get a much nicer house than you have for around the price you paid for your ugly one. By the time you spend the money to fix it, you could have bought two nicer homes and saved yourself a lot of effort. Granted, real estate prices will eventually rise again, but none of us really knows when that will happen.

So by now you may be wondering just what is the best way to buy a property if not a fixer upper. There are three methods that work really well. One is to look for a homeowner who lives in their house and is being foreclosed on. These people will often sell for the balance of their mortgage to save their credit. They know that they can't afford the high cost of the mortgage and often times will be willing to swing a deal if it could possibly help them qualify to buy another home. The second place is to look for homes that are owned by banks. These are homes which have already been foreclosed on and they will often be sold at auctions or by Realtors who work side by side with the financial institutions. Your branch manager should be able to tell you. If you can offer the bank a reasonable offer, they just might take you up on it. The third method is actually going to the auctions yourself. If you purchase a home at an auction, you will need cash up front. It may sound expensive but the deals you will find just might amaze you.

The fact is, there are a large number of real estate properties being foreclosed every day. When you combine an excess amount of real properties with the general fear of the marketplace, it can create some fantastic bargains. Anyone who is willing to look around and do a bit of research into buying real estate in a market like this can benefit greatly by getting a nice home at a bargain and never need to buy an ugly fixer upper.

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