ᐅ Buying a House at a Foreclosure Auction – What Is a Realistic Price?
Created on: 10 Jan 2020 08:07
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Maddy86
Good morning,
We are considering buying a house built in 1960. The current owner purchased it two years ago through a foreclosure auction. The market value at that time was stated as 75,000, but he won the auction for 100,000. Afterwards, he apparently paid off a mortgage of 45,000 that was still registered on the property.
If he were to sell it now, he would have to receive around 200,000 because of the taxes he would have to pay (due to the mortgage). After six years, this would likely no longer apply.
Is this all correct? Unfortunately, we have no experience with this! Are there other options? The amount of 200,000 would exceed our budget and seems quite high to us.
Best regards, Martin
We are considering buying a house built in 1960. The current owner purchased it two years ago through a foreclosure auction. The market value at that time was stated as 75,000, but he won the auction for 100,000. Afterwards, he apparently paid off a mortgage of 45,000 that was still registered on the property.
If he were to sell it now, he would have to receive around 200,000 because of the taxes he would have to pay (due to the mortgage). After six years, this would likely no longer apply.
Is this all correct? Unfortunately, we have no experience with this! Are there other options? The amount of 200,000 would exceed our budget and seems quite high to us.
Best regards, Martin
N
nordanney10 Jan 2020 19:35Maddy86 schrieb:
There simply aren’t any comparable properties because nothing like this is on the market.Who would want to live in the middle of nowhere without any infrastructure? If you build a house there now for €500,000, the depreciation (market adjustment factor) is such that you’re better off living there longer. Otherwise, you would lose a lot of money if you sell.nordanney schrieb:
Who wants to live in the middle of nowhere with no infrastructure at all? If you build a house there for 500,000 euros, the depreciation (market adjustment factor) is such that you’d rather stay there longer. Otherwise, you would lose a lot of money if you sell. The good thing about the middle of nowhere is that prices are affordable—especially compared to what you all probably had to pay to build or buy. Anyone who can accept living out here isn’t making a mistake. Work is nearby, family, friends. I don’t need more.
We also understand what building depreciation means. That’s why this house would be more of a long-term plan for us.
I still don’t fully understand the reasoning behind the purchase price including taxes, but that’s actually not really important. What matters is the cost of comparable houses in your area, or what you can get for 200,000. To my knowledge, this is now the minimum price even in very rural areas for the type of houses that are not among the roughly 85 percent of poor-quality homes currently on the market. A building expert or real estate appraiser can better help you assess this.
Zauberwesen10 Jan 2020 20:38Maddy86 schrieb:
If your "villages" are so well equipped, then I know where the solidarity surcharge goes..If you had paid attention in school, you would know that the solidarity surcharge has never been used exclusively for the "new" federal states.
Zauberwesen schrieb:
If you had paid attention in school, you would know that the solidarity surcharge was by no means used/is used only for the "new" federal states.No worries, this was not intended as an insult or anything like that. If it was taken that way, I apologize!