How to Find Cheap Houses for Sale
By Steve Gillman - 2011
There are a number of good ways to find cheap houses for sale,
some of which are outlined here. They will not all work for everyone,
as you will see. But whether you are buying rental houses or
just want an inexpensive home for yourself, at least a couple
of these methods should work for you.
Buy Houses in Cheap Cities
The first thing to consider is whether or not you can move
(or if investing, whether you have the time and motivation to
invest at a distance). The same house can cost $500,000 in one
town while selling for as little as a tenth of that in another
area. You may not even have to go too far. Here in Colorado,
for example, houses start at around $30,000 in Pueblo, while
35 miles away in Colorado Springs the same homes would be two
or three times as much.
Keep in mind that which cities have cheap houses has changed
in recent years, so don’t be too quick to dismiss a place
as expensive until you at least do a quick search on one of the
major real estate listing websites. Many towns and cities in
Florida, for example, were expensive juts five years ago, but
were hit hard in the downturn. Some houses that sold new for
$180,000 in Cape Coral are now selling for $45,000.
Buy Cheaper Housing Types
Broaden your criteria and you will have many more options
for cheap homes. For example, in Naples, Florida, you can’t
find homes for 75% less than the top like in Cape Coral, but
you can find nice two-bedroom condos selling for under $80,000
- less than half of what they sold for a few years ago.
If you are investing in rental homes you might consider mobile
homes that are on property. As long as they are on their own
land they tend to appreciate just like regular homes, but they
sell for much less without renting for much less. For example,
in some places a $100,000 house might get $800 in monthly rent
while two $40,000 mobile homes on land bring in $650 each per
month.
Which types of property are cheaper varies from place to place.
Wood frame single family homes are expensive in some towns, while
condos cost more in others. Cabins or modular homes are other
options to consider depending on your goal.
Buy Fixer Uppers
Whatever type of home you look at, the cheapest ones will
often be those that need some work. A house that needs $15,000
in repairs will often sell for $30,000 or even $40,000 less than
a similar one that is ready to live in. If you are willing to
deal with contractors for a few weeks, or enjoy working on houses
yourself, these can be great opportunities.
Offer Less
There have been times in some places, where low offers were
a waste of time. But with real estate prices falling for years,
sellers are more willing than ever to look at any offer. Even
if your offer is not accepted, the counter-offer might be at
a lower price than you originally hoped to get the house for.
Buy Foreclosures
Banks are sitting on a lot of houses that they need to sell.
Unlike regular owners, who might wait for a market rebound to
sell, banks need to move the inventory off their balance sheets
for regulatory and other reasons. That means they are typically
willing to sell cheaper.
Buy Short Sales
A short sale is when an owner sells you the house for less
than he owes on it. It has to be approved by the bank to have
the lien removed, but they are being approved at record numbers.
The owner just wants to escape with his credit intact, and the
banks are willing to take a loss now rather than have the expense
of foreclosing and selling later.
Combine Several Methods to Find Cheap Houses
To really find cheap houses for sale - the cheapest of the
cheap - consider using several of the techniques outlined above.
This works especially well if you are buying as an investment
rather than to live in the home. For example, you might find
the cheapest town within a couple hours of where you live, identify
the cheapest type of housing to focus on, then find foreclosed
fixer-uppers that you can make really low offers on.
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