When buying at Auction be sure to find out if it is an Absolute Auction or an Auction with Reserve. Also, don’t forget to add a Buyer’s Premium on top of the final selling price. The premium can run 5-10% of the selling price and you, the buyer, are responsible for paying it. Don’t even think about backing out of a deal once you’re the final bidder since most Auctions require a full 3% non-refundable deposit. Foreclosures still only represent 1% of total inventory and just because a home sells for “cheap” doesn’t always mean it’s a good deal (i.e. is it near power lines or on a busy road). I think this is a market of opportunity and have made some pretty good money from real estate in 2007; sold primary residence for record high for the plan ($1.330m, paid $925k in 2004 from bankruptcy court plus about $180k in improvements), sold a flip for $430k minus $10k for buyer credit (paid $305k five months prior as an REO, put about $55k into it, market time was only about 3 weeks and had 3 offers), bought new primary residence for $950k as an REO have about $75k in improvements and it’s worth a solid $1.2m. Oh, and this is after buying a condo for $565k in 2003 and selling it in 2004 for $835k with only about $15k in improvements… You have know when to spot a good deal and be ready to move on it!
