Buying in Bed Stuy - worth it to try and get a foreclosed / REO home?
Hello Brownstoners, been following the blog for years but never posted…I’m a first time would-be homeowner starting the search with my spouse for 2 family homes in Bed Stuy – wondering if anyone has an opinion on whether it’s worth the time investment/hassle/energy, etc…to try and research/buy an REO or foreclosed home in the area? And if you think it is, anyone have advice on someone who could help in the process…? Seen a lot of 2 or 3 family’s recently that were bought at a seemingly major discount in 2010 and are being flipped now for a lot of money after pretty bed renovation jobs…not very appealing… Thanks for any and all thoughts or advice in advance!
JIsadora
in Brownstoner 13 years and 4 months ago
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NewOwner | 13 years and 4 months ago
(Sorry if this is a double-post – had a computer glitch). If you fit within the income guidelines, you should take a look at the newly renovated homes on the HPD, NHS of NYC, and Restored Homes HDFC websites. They were all recently rehabbed through City programs, so you won’t have the maintenance issues. There are income limits and resale restrictions, though.
Kateruba | 13 years and 4 months ago
I am very interested in this topic as well, please keep it going!
JIsadora | 13 years and 4 months ago
Thank you all for your insight and responses so far!
SewardWasRight | 13 years and 4 months ago
I think blanket statements like these (i.e., “If you are a first-time homebuyer I strongly urge you not to buy a fixer upper. It will cost you far more than you anticipate since you have no experience,” or “Unless you’re a contractor yourself, you don’t save money by buying a fixer upper. It’s a popular delusion.”) really do little more than to muddy the waters on the topic. I know they are meant to help, and agree that buying this way is not for the faint of heart, but it is completely doable for the right people. Who are the right people, is the question. And do you have to have experience in doing this exact thing to succeed? I don’t think it is 100% necessary, but I agree that it helps. As a first time homebuyer, I purchased a fixer-upper as my first home (as did several of my friends/neighbors). We negotiated good prices on the purchases and we wisely managed the renovations, living in the structure until completion. We all stand to have created wonderful living environments and have made sound investments that have increased in value beyond the cost of the houses and renos together. And in 20/20 backsight, none of us would have done it in any other way. It does help to be the type of first time homebuyer who has certain skills that complement this process – organization, research, persistence, &c – o, and a sense of humor! While it an be extremely frustrating and nerve-wracking at times (many, many, many times!), it is completely doable and can be a very fulfilling experience. 99% of the other statements, though, I think are very sound. Caveat emptor, Jim.
northofditmas | 13 years and 4 months ago
If you are looking for that type of house your price range is probably limited. In that case you cannot afford big surprises. Even with title insurance you could end up in court for a year. Mortgage company will not give you a loan if that house is not habitable. Foreclosed home might have all the plumbing stripped when you get it. A developer can afford to take these risks and sometimes they pay off big and sometimes they get get burned. If you can’t afford a sudden $50K “problem” then you need to be careful before you get foreclosed on next. The cheapest listing don’t all make the real estate sites. Work the local agencies and once in a while something crazy cheap pops up on craigslist.
daveinbedstuy | 13 years and 4 months ago
Mortgage rates for home in move in condition will NEVER be lower. I encourage you to borrow wisely and buy the best you can afford while financing at these rates. If you are a first time homebuyer I strongly urge you not to buy a fixer upper. It will cost you far more than you anticipate since you have no experience. take advantage of the rates and buy what you can afford.
Augustiner | 13 years and 4 months ago
Everything has it´s price, and nothing is as cheap as it seems 🙂
callalily | 13 years and 4 months ago
Just keep looking for those places that a familly has owned for a long time and that are habitable and in good condition even if not completely to your taste in every respect. They are definitely out there. You will find them.
callalily | 13 years and 4 months ago
When I was looking in 2008/2009, it was mostly wrecks and flips. As far as I know, that’s par for the course. Have you reached out to local agencies? See what Stuyvesant Heights Brokerage, Flateau Realty, and Corley Real Estate have. As for foreclosures and short sales, you may run across them in the normal course of things. I did. Or are you talking about an auction on the steps of the courthouse? Not really practical. Those are bought “as is” sight unseen and can have problems with title, condition, liens, and violations. You will see houses that can only be bought in cash or with a 203K loan because they lack heating, plumbing, roofs, electric, etc. These are great for contractors, architects, deep pockets, and others who have the time and interest to spend six months fixing up a house while they live elsewhere. Or you can buy a fixer upper with a conventional mortgage but you’ll probably need quite a bit of cash on hand (~$100,000) to fix it up. (That’s what we did.) Or you can wait and find a place in move-in condition with at least some original details. If you’re a first-time buyer and you don’t have a lot of spare cash, that may be your cheapest and best route. Unless you’re a contractor yourself, you don’t save money by buying a fixer upper. It’s a popular delusion.
haiderbk | 13 years and 4 months ago
this is the best time to buy place in bed-stuy. place got better within last few years. but you can buy a house that will need lots of work, so you can save.