Buying reposessed houses

ixedoc

Hi there,
we are moving to london. we r a family of 4 with 2 young boys. with reposessions on an all time high i wanted to know how to find out about these houses and how can i purchase such property and indeed can u really make any savings?
regards

Honest_EA

Repossessions are not advertised as such as the bank doesn't want it made obvious that a house is repossessed. The Estate Agent might let you know if they have any repos so I would call into all the agents in your area to ask if they have any on their books. Repossessed properties are valued by independent surveyors so are often on the market at a lower price than a vendor owned property that has an unrealistic asking price because the vendor doesn't want to sell it too cheap. If you look at Rightmove or other property websites, it will be obvious which properties are repos fro mthe pictures as they will have tape across the toilet, sink etc to stop people trying to use it since the water has been turned off. There will also be little air fresheners on window sills as the contractors have to place them there.

PS, to make an offer on a repo you will need to provide proof that you can proceed quickly so will need to provide an Agreement in Principle from a mortgage lender or show proof of funds in your bank account. Good luck.

sonastin

Don't restrict yourself to buying a repo. Just go through the usual house-hunting process. Repos that can be moved into straight away are advertised by estate agents just like any other property up for sale. If the repo is going to auction, its because there is a problem with it. If you're interested in auction properties, consider everything in the auction that meets your needs, not just a repossession.

You might get a bargain if you buy a repo, but others will also spot the bargain and you could end up in a bidding war. Equally, you could get a bargain if you find a vendor who is desperate to move. Buying a repossession comes with a whole set of "rules" that can make it more stressful than a "normal" purchase and the discount is not always enough to justify the stress.

Just look at all houses on the market, decide what you think each is worth to you and hope that you come across the right vendor...

G_M

or take your life (money) in your hands and try auctions.

Bronnie

As others have said keep an open mind about other properties too.

You can feel like you're losing a lot of control during the buying process of a repo. My experience was of the other side's solicitors flatly refusing to deal with or answer most of the questions that my solicitor raised and would be considered normal and reasonable in a regular situation.

Very much, take it or leave it and hurry up!

quantic

I don't know where you can find out about repossessions but here are a few things to consider...

Buying a repossession can be very stressful, I have just gone through the process and you have got to emotionally detach yourself from the property until the day you move in. Things like getting a yes or no to an offer can be considerably more drawn out, as you put in an offer and it then goes to the bank where it is reviewed. You need to be able to get the cash available very quickly when you get a yes so you are limited to a few mortgages, ours took just under 3 weeks to complete (20 days). We have replaced pretty much everything since we moved in, (we intended to do this regardless) and had a few issues with boiler but other then that its been fine. (Pretty hit and miss really)

All of that said you can make a considerable saving if you do this. We paid £110k for our home, the original owner paid £189k in 2005. So in essence we now owe £92k on a house that is worth somewhere between about £150-180k. Not bad consider we only put down 18k originally. I have no idea how much the property is actually worth in the current market because prices are so scattered. In 2007 the house 3 doors down (identical) sold for £209k... Which is 99k more then we paid.

Personally I only think its worth bidding on a repo if the price is significantly less than other properties, as its pretty much you get what you see with no guarantee's. Which can be very stressful and expensive if anything goes wrong, but can also be very good if it goes well! All the best with your purchase.

Doozergirl

I don't think repossessions are at an all time high are they?

They aren't necessarily the way to a bargain. They usually reflect their condition. The ones that do go cheap tend to be because an issue has developed that renders the property un-mortgageable - in which case you need cold hard cash. These are houses that a regular vendor or their solicitor could fix if it were being sold under normal conditions, but lenders don't have the time or inclination to do.

I'd look everywhere for a house. You may stumble across a repossession. And you'll know it when you see it even if the EA doesn't tell you straight out on a viewing.

It's a bit easier to make lower offers because you won't offend people, that's true.

MrJF

The best way to spot a repo on sites like RightMove is to look at the pictures.

If there are very few pictures (especially none of inside the house) then it's almost definitely a repo.

Also if the inside is bare and there's tape around toilets, sinks etc, that's usually a repo.

I'm in agreement with other people about keeping your options open. I nearly purchased a repo in January, first time buyer, all going nice and smoothly and then on the day we were ready to exchange our offer was trumped and we couldn't match it quickly enough. We ended up loosing £1,000 on the money we paid for Sols fees, survey etc. So it depends how much of a gambler you are

ixedoc

thanku for all the replies. i have taken in ur suggestions. i was looking into this aspect of house buying coz the house prices are so inflated and i do feel embarrassed to give a very low offer and offending the vendor as well!

Moomum

It's also so stressful buying a repo, with a chance of being gazumped right up to exchange. Our situation was a little unusual, repo on offer in nice road for £515k, cut along story short we finally got it for £631k and then gazumped for £660k a week before exchange! madness!

Running_Horse

Try using the search button. This subject has been done to death.

Whoever told you repossessions are at an all time high is a liar.

Whoever told you they are the best way to a bargain is probably wrong.