Cheap, Bargain, Real Estate - Real Estate Essay - Real Estate in Rehoboth Beach and Lewes Delaware

Cheap, Bargain, Real Estate; Good Deals, Below Market, Low Priced properties are available if you know how to buy them.

By Jody Hudson
Copyright 2002

Cheap Bargain Real Estate, Good Deals, Below Market, Low Priced and Less Expensive; homes, lots, land, businesses, and condominiums are everywhere and easy to find. Here is how to find and buy them from us or anyone, anywhere.

This article is about. How to find and buy aBargain, A Good Deal, in real estate; how to get it real cheap.

Nearly every call or e-mail that I get is asking me to find the buyer a bargain. We all feel that way when we are buying as well. All of us want a good deal. We all want to get cheap real estate. And we can all do it.

There is a bit of a challenge however. Every single buyer that I've ever had in my thirty two years of selling real estate has wanted to sell the property they have for more than it is worth. Herein lays our challenge as Realtors.

To get those HOT deals in real estate there are at least three things you must do:
1. First of all as a buyer you must be willing to act faster than any other buyer.
2. Second you must be able to know a bargain when you see one.
3. Third you must BUY it. That is write a deposit check and write a contract that will win over the other contracts that may be presented at about the same time as yours. Sounds simple, but only about one buyer in each ten year period is willing to do these three things in order to get the cheap property they have asked us to find for them.

Recently the waterfront home next to ours was listed for sale for $249,000 and it was worth at the time about $350,000. Kate and I called each of our family members, our wonderful neighbors on the other side (one of whom is a local builder and the other a mortgage broker) and some of our best clients and a best friend of ours, a builder and investor, who had already said he liked the fine home.

We explained that the home was going on the market in a few hours and that they must act fast. Our neighbors on the other side, the most knowledgeable of the bunch wanted to make an offer of $180,000 saying they thought that was all the property was worth. They knew better or at least should have and they should have bought it. They did however get another property in a few days as a result of improved awareness after loosing the one next to us.

Our savvy investor friend put in a couple of offers below the asking price with several contingencies. Meanwhile we are telling everyone to write a contract for full price with no contingencies and calling on both our phones as fast as we could dial. None of our best friends or family would pay attention. They were ALL too greedy. They knew the property was far under-priced but wanted it for less.

Then our lovely new neighbors came and saw the property. They also were knowledgeable about similar properties, and had lost several properties they liked by moving slow, writing unreasonable contracts and not paying attention to real values. This time they did it correctly. In fact they wrote a contract on the spot, with no contingencies, and for MORE than full price so that if anyone did offer full price they would still have the best chance. They paid $5,000 more than the full price on the spot, told the sellers they could have settlement any time they wanted it and before they even heard back from the sellers they arranged for a mortgage of MORE than they needed and asked for the money to be immediately available. They did not ask for a home inspection, survey, or for the sellers to fix anything. The home is 30 years old and has not had one bit of maintenance. There was a burst hot water tank, a roof that needs replacing and a few HUGE cracks in the foundation. All these problems are going to cost them, by the time they are done, about $15,000. They have owned the property for several months and work on it every weekend. They love it. If they were to fix all of the things that need fixing, paint the trim and freshen up the yard and landscaping; we could get $400,000 to $450,000 for this home for them in a few months on the market - as spring and summer arrive. And, city sewer will be here in two years, at that point the property will instantly go up another $100,000 and all the people we called knew about the sewer too. The buyers didn't find out about the sewer coming to town until after they had contracted to purchase the property.

By doing the three things listed above the purchasers of the home next to us have made the wisest purchasing decision thus far in their lives and have one of the best bargains that have been available in the last several years. The sellers are happy too as they just wanted to sell it as fast as they possibly could, due to a sudden and dangerous illness of one of the owners.

I'm writing this article to serve you the reader. But you must know it is self serving as well. Much of our time as Real Estate Agents is spent trying to successfully educate our buyers and sellers. If they would take our advice they could be far, far, more successful in selling or buying. The articles I write here are those advices that I give my customers and clients - if they ask. Most don't and when they do, very few take the advice. Just like in every other profession, we the professionals do what we can to help those who come to us but it's up to them to take the advice.

Another way to get property cheap it to buy property that is not pretty and then make it pretty. For instance, wood land that has been cut sells for far less than it should. You can purchase the land and then have it cleaned up for a total of a bargain price. Also, cut over land is FAR more attractive to animals and birds than wood land or farm land either one. The rough ground cover of cut over timber land is a natural protection for all the little things that are at the bottom of the food chain and those little things attract the larger critters. Cut over timber also quickly grows all sorts of grasses and little trees and these little trees, it's called browse, are the favored food of deer. There will be song birds, hawks, fox, squirrels, raccoons, turkeys and all manner of critters in abundance in cut over wood lands.

My favorite tactic on this land is to push back the tangle of limbs and stumps that are left after harvesting the trees into a large berm around the property. This berm then serves as a visual and privacy barrier that is almost free to achieve and in a matter of months, before your home is even built, it is covered with greenery and you end up with your own completely private estate for far less than the cost of other land. Only those people with imagination can see, in their minds, what the end product will look like so almost no one buys land and does this. When one of us purchases such land, clears it and builds a berm, we get far more for the land than other similar land in the area when we sell it, due to the
beauty and privacy that result.

Bargain homes are always available - but hard to sell. They are homes that are in need of some repair or cosmetic improvement or that are in an
area of transition. We have several on the market right now and they are hard to sell. Someone with vision will eventually purchase them, fix them up and perhaps sell them at a huge profit - often to someone who says they want a bargain but won't do what it takes to get a bargain. Funny isn't it, and this sort of thing happens all the time.

There is a farm house for sale, as I write this, that is on 4.4 acres and under-priced by at least $100,000 and no one wants to go look at it. It is almost a hundred years old and has not been modernized. It is for sale now for $155,000, the sellers say take any offer near the price. It will soon be surrounded by homes that range from $200,000 to $500,000 and they will be on smaller acreage. The sellers bought a big farm, are going to build nice big homes on the other land and just want to get rid of the original old farm house. It is structurally fine but it needs about $45,000 in upgrades - then it will be worth about $275,000 right away and far, far, more when the other homes start surrounding it. There are always lots of places like this and always almost no one that is willing to purchase these bargains. Those who do purchase homes like this can often earn enough
fixing them up and selling them to support themselves with no other business or job. And when the fixer-uppers are fixed up they sell for a premium if they are done right.

Other bargains are available in transitional areas. Where Kate and I live is one of those; that place is Oak Orchard. Oak Orchard has been an inexpensive place with sewer problems and soon that will be history. But most people don't want to buy now, and save 50%, they will wait until the sewer is in and then wish they had bought earlier. Oak Orchard, anywhere in Oak Orchard and surrounding areas are the bargain properties now and there are dozens of them.

Millsboro is another area in transition where residential and commercial bargains lie there waiting for those willing to educate themselves and purchase properties at less than they would be almost anywhere else. There are lots of other areas like Oak Orchard and Millsboro, such as Cool Springs, Harbeson, Georgetown, Ellendale, Angola, Long Neck and beaches north of Lewes.

If you want a bargain; educate yourself and do One, Two, and Three. We'll try to help you.

Jody Hudson: MrJodyHudson@earthlink.net

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