Many buyers think if they grab an REO they are getting the best deal in the Lake Ridge neighborhood. Today let’s look at two similar contemporary style homes for sale in Lake Ridge to see which might be the better deal.
The first property is a Lake Ridge REO listed for $269,900. The second home is an Lake Ridge regular sale priced at $329,950. Without going in further a buyer might say the REO is the better deal as it’s priced a good deal lower. However let’s dig a little deeper. Even though the floorplan on the top two levels for these homes is essentially the same, the regular listing has a full basement. This adds about 25-30K to it’s value.
Here are photos of the kitchens in the two properties. The regular sale has expanded the kitchen into the small room off the side and the REO has the original galley kitchen. Add another 15-20K onto the money needed to upgrade the REO.
As a Lake Ridge buyer it could be easy to get taken in by the listing price and not think about all of the additional money you are going to need to sink into the home. Unless you are buying a fixer-upper with an FHA 203K loan, with the repair costs figured in, the additional money for repairs has to come out of your own pocket. You also are buying an REO “as is.” Even if you have a home inspection the lender may not fix any problems you find with the home. You may have an option to cancel your contract based on other contingencies but it still could be an expensive proposition.
If you are thinking about buying a new home in the Lake Ridge neighborhood this winter give me a call to discuss what you should be focusing on when you look for a new home. Don’t fall victim to the idea that the lowest price means the best deal. The fix up costs might just push the REO to the bottom of your list.