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Feb 21

The true cost of buying a foreclosed home: your foreclosure calculator

Homebuilders are working harder to tell their story

The cost of a new home from a builder is all built into the price. Compare that with a foreclosure that sells ‘as is,’ but may wind up costing more than a new home because of the ‘fixes’.

Online Truth Squad

In Phoenix, one large builder, Fulton Homes, has put together the equivalent of an online truth squad — an interactive foreclosure cost calculator that allows shoppers to estimate the expenses they’re likely to encounter if they opt for a foreclosure.

The calculator uses what the company’s vice president, Dennis Webb, said are commercially available expense averages for acquiring, repairing and outfitting foreclosed houses of varying sizes, conditions and price levels in the area.

Say you’re shopping for a home to live in

… and you locate a number of foreclosures at low listing prices. You’re also aware of newly constructed homes that appear to carry higher prices for similar lot sizes and square footage.

The cost calculator prompts you for the size, price and physical condition of the foreclosure.

Let’s say one of them is listed for $110,000 with 2,125 square feet of living space. Based on a drive-by, you estimate the overall condition to be fair.

The dark side of foreclosure homes

For that foreclosure, according to their data, the typical post-acquisition costs — the repairs, new equipment, appliances and other improvements to make it adequate for you and your familywould add $32,288 more to the price you pay.

Likely expenses include …  and, for more click here.

 

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