Many people enter the housing market looking for a fixer-upper. Whether it is because they want to turn it into their dream home or give a property some TLC to make it an investment opportunity, there are plenty of buyers willing to take on the challenge. For some motivated buyers, the ultimate fixer-upper is an abandoned house.
A property abandoned for a length of time might not be appealing to some buyers. These properties may come with a long list of rehabilitation projects and it could require dedication to make them livable again, but they can be a desirable option for DIYers and investors. However, before buying an abandoned property, you should weigh the pros and cons.
Why might a home be abandoned?
There are several reasons why a home might be abandoned, which could affect the overall buying process. Here are a few of the most common reasons:
- Environmental issues like flooding
- Legal issues
- Death of the owner
The pros of buying an abandoned home
Before you decide you want to purchase an abandoned home, you must determine if it’s right for you. First, consider the pros of buying a home in this condition.
The major draw to an abandoned home is buying the home well below market value. Whether you’re buying the property to flip or to live in, you’ll likely be able to save a substantial amount of money buying an abandoned home compared to a standard home on the market. Many foreclosed homes become abandoned, and the banks that own them may have motivation to sell the property to recover some of their losses.
If there is a particular neighborhood you are looking to move to, an abandoned home could be an option, especially if it’s in a competitive market. Instead of paying over the market value for a move-in ready home, renovating an abandoned home may turn out to be less of a hit to your bank account.
You may face less competition when trying to buy an abandoned home compared to other real estate options. Many home buyers worry about the potential high costs and the amount of time it takes to rehabilitate an abandoned home.
The cons of buying an abandoned house
Despite some of the pros, there are several negative aspects you must consider before buying an abandoned home.
The home will likely be in some stage of disrepair and will sell as-is. Depending on the length of abandonment, the home could need considerable rehabilitation that takes time and money. You may need to deal with some potentially hazardous and expensive repairs to the foundation, plumbing, HVAC, and structure, as well as asbestos removal and water damage repair.
Finding the owner
Banks and cities are the owners of some abandoned properties. However, some vacant homes may still have someone who is the legal owner. You will need to do a title search, and the owner of the property may not be easy to get in contact with.
In addition to the overall physical condition of the home, there may be other concerns. There may be an infestation of insects or small mammals that you’ll need to take care of. You’ll also need to look for signs of vandalism, and there may be people staying in the home who do not belong there.
How to find an abandoned home
The first step in buying an abandoned home is actually locating one you’re interested in. You can drive around looking for an abandoned home, but this isn’t always the best option. Even if a home has the tell-tale signs of abandonment—unkempt yard, structural damage, no cars in the driveway—there could still be someone living there.
To find an abandoned property in your area, consider one of these options:
- Search local government websites. Some municipalities list abandoned properties for sale online. If you can’t find what you need on the web, your county clerk may have the information you need.
- Check with banks. Some banks keep listings of foreclosed properties online, making this a good way to find a property in your area. Banks may also hold auctions for these properties.
- Speak to a real estate agent. If you’re looking for abandoned property in certain areas, an agent may have information to help you find what you’re looking for.
Get an inspection before buying
Before buying an abandoned property, make sure you get an inspection. Even though you know buying an abandoned home will require some major renovations, you want to be sure you know everything that will be on the to-do list. Major structural issues or foundation damage could destroy your budget.
Buying an abandoned home isn’t for everyone. However, if you’re up for the challenge, it could be a great investment for you and your family.