Cheap Property 23 February 2007 at 9:55PM in Mortgage-free wannabe 9 replies 1.2K views

Sweet_Sugar_1984

Hi.

I am a first time buyer, but it seems as though I've been priced out of the market. I would love to get on the property ladder, but it just currently seems impossible.

Anyway, I have heard that there may be cheap properties available through banks (houses that have been repossessed) or my local council (derelict/fire-damaged properties). I was just wondering if this is true?

And if it is, how do I go about getting info on such properties?

wymondham

not sure, but if they are that bad would you be able to get a mortgage on them ?

IHateDida

Why not do a share ownership with a housing assosiation? Contact your local one - you can then pay half the mortgage on a property with the aim of owning half the place, and pay a bit of rent on the other half.

firesidemaid

only thing with shared ownership is you can pay as much per month as if you had the whole mortgage - i know it is based on afforability.

do you have a deposit and what is your income and the average price that you would be looking at?

do you have a good credit history? could you save more money or earn extra?

could you move a bit futher out to a cheaper property/area?

janine22

You could look at new build properties? I don't know what area you are in but many offer incentives to first time buyers such as 5% deposit paid, flooring thrown in etc.

I think it is possible to get on the ladder (I've recently bought my first house) but you're right, many areas/properties just aren't an option.

Try looking at regeneration areas where you are, there are some bad and some good. Properties will be cheaper in these areas. My house is in a regeneration area in Sheffield and the area honestly could not be nicer!

angelavdavis

I thought councils, etc got rid of most of these properties via auctions. Check out sites like Clive Emson.

imoneyop

janine22 wrote:

You could look at new build properties? I don't know what area you are in but many offer incentives to first time buyers such as 5% deposit paid, flooring thrown in etc.

But you don't think they do this out of the kindness of their heart do you? They do it because the basic price is inflated so they can afford to knock 5% off.

RufusFrog_2

Keep a close eye on the local paper - I often see notices along the line of 'X has received an offer for £Y on the following property (...address of property...); if anyone else wishes to make a higher offer, please submit in writing by such-n-such a date'. They normally want a very quick sale and tend to go to cash buyers/developers so you need to have found a mortgage provider who really can fasttrack the offer.

Similarly with auction properties, normally you must pay 10% on the day and must complete within 28 days or lose that 10%; surveys have to be done BEFORE the auction as the offer is binding. Watch a couple of episodes of 'Homes under the Hammer' to get an idea of what it's like.

imoneyop

RufusFrog wrote:

Similarly with auction properties, normally you must pay 10% on the day and must complete within 28 days or lose that 10%

It can quite often be 14 days for completion!

Eyesparky

As posted, the majority of these properties go to auction and fetch good market prices at the moment due to demand. When you read a book about making money from property, repo houses are often cited. The time to buy repo houses is when the market has had a downturn that has had a good time to bite hard - hence high supply.

Often when all around are shouting the loudest that the bad times are here for ever and things will never get better ... then buying repo makes sense - especially if there is scope to add value through improvement / bringing up to standard. Of course, in this situation, the likelihood would be that banks would be unwilling to lend money so readily, so the spoils go to the cash buyer and the high risk taker.

There are always opportunities but at the moment a lot of effort needs to be put into the research and figures to make sure an investment makes sense. There are a high number of professional and amateur property developers chasing few major refurbishment projects. Just make sure you are happy and realistic with the numbers.