Has Anyone Had Any Deals Buying From HUD?
I have been trying to buy investment properties from HUD but they don't seem to accept our bids. They are too low I guess. We have a bid in 5,000 below asking, but they have not accepted it. Has anyone had any good deals buying from hud. I am want to buy fix up and sell.
Please let me know.
Thanks,
Sheila
Generally, unless the house has been on the market for a while (at which point HUD will discount the property) you will be bidding MORE than HUD's asking price. I've gotten a few deals on HUD property in the past but its been my experience that most properties are listed for FMV so not alot of "deals" to be had. Also, HUD properties are all As-is and many have code violations.
Code Violations? Do you mean how it was built or that it needs to be fixed up?
Sheila
Actually, HUD properties come in three categories:
IN- Insured - eligible for FHA financing
IE- Insured with Exceptions - insurable for FHA subject to some minor repairs under $5k
UI - Uninsured - property requiers more than $5k worth of rehab and thefore does not qualify for FHA financing.
From what I have seen, your best bet is to go after UI properties, as FHA buyers won't be able to get to them. Most insurable properties go to FHA buyers for top dollar.
In my area, Hud appraisers must be on the bottle!!They appraise homes at MV with very little room for us investors to make a profit. Personally, I have not bought a Hud home in 2 years....
Prosperous investing,
td
I just went to a seminar by a HUD broad listing agent last night. She said to take a look at the listing price and winning bids to back into the calculation of what HUD accepts. I got the impression that 10% below the listing price is a winner. The net to HUD is all they consider.
I am a registered HUD broker and get calls from would be buyers for properties in the imediate area of my practice. I have not sold a property in two years. The only one worth a damn was reserved by HUD for non profit corporations only. That sold about 15% over value. The fix up on it was enormous and the man that bought it is buried in it and is giving a facelift when he should be considering serveral interesting structual failures. The other property is a two story house built by Gypsies late at night, under some of the biggest baddest high tension lines you ever saw in your life. It looks like a Sandford and Sons Set. I cannot figure how it can be bought and a profit made. I cannot even come up with a land value cause when you are on the property you hear this constant hum from the power lines. I mean if you own a circus and raise freaks this might be the place cause my ears seem to light up whenever I go near it. So I do not sell Hud Properties. at this time. I know I should not comment but really Hud is in a little world of its own. I still check every 15 days and am on line with them but Nada. I would not put any of my friendly investors on their deals. I have a few family trusts that I could invest as they leave it in my good hands. Such an investment would be criminal. If I am going to do that might as well start a new ****Must Reach Senior Investor status before posting URL's***.....
Cheers Lucius da frustrated Broker
While I'll agree that most HUD properties are not 'deals', they are out there if you know what you're looking for and how to market them after the purchase.
We just sold a HUD purchased home for $90K that we got for $68K. Had about $8k in repairs & costs, held for 3 months for a $14K profit.
Roger
the condo i just bought was a HUD. the appraisal came in at $77,000 and i got it for $53,000 as far as i'm concerned its a deal. i already have a tenant to move in for $775/month and my mortgage is only $424.40... instant $24,000 equity and $350.60/month pocket money.... but someone said earlier, you have to wait a while. this one was listed for a year. but if you look you can find good deals.
[addsig]
I think it all depends on your area. In NC there are some good deals on hud and va. I picked up a hud for 119000 with 2k closing costs. Appraised for 136000 with my independant appraiser. Bank appraised it at 125000 before 2k in repairs. Rented and doing great
I'm currently on my eighth HUD house, all of which have sold at a minimum of $7K net profit.
The key is finding a knowledgeable HUD Broker. HUD pricing seems to be all over the place, and usually when they first hit the market they are overpriced. In my market, though, (Georgia), they drop the price regularly (every two or three weeks usually, and always on Friday). A good broker can find out how low the next drop will be (most HUD brokers claim this cannot be predicted).
Finally, I want to tell you about my greatest HUD jewel: 40 year old house that previous occupant had taken a sledgehammer to ever single piece of sheetrock and glass in the place. HUD boarded up the 8 broken windows on the front, but it looked awful.
Picked it up for a whopping 61K, spent the most I ever have on a single rehab 17K and sold it 2 weeks ago for 104K after 20 days on the market.
Deals like this, while admittedly rare, make investing in property such a fun sideline.