How to Buy a Dollar House 2020: Buying An Abandoned Home

Buying An Abandoned Home:

Are you looking to buy an abandoned home? In this article, Dollar Homes program is the easiest way to find abandoned homes for sale.

Buying An Abandoned Home

All the homes in the Dollar Homes program are previous FHA-loan foreclosures that are empty. This homes are just waiting for someone to fix them up.

Some of these abandoned homes are listed on the Dollar Homes website, where the public can purchase the abandoned homes for sale at rock bottom prices.

In this article:

What are Dollar Homes?

According to the HUD website, the Dollar Homes initiative was designed to help local governments promote home ownership opportunities for low income families. The homes were to be sold for literally $1 each.

Thousands of homes have been sold through this website for just $1 each. However, at the time of this writing, the two “Dollar Homes” listed on the site were listed for $5,950 and $10,447, respectively.

These homes are intended to be purchased by local governments or non-profit organizations who will renovate the home for resale. However, the HUD website indicates that you can make an offer on the home through a HUD-approved broker.

What is an Abandoned House?

An abandoned house is a vacant property due to foreclosure, bankruptcy, and financial or legal reasons. Since most homes are abandoned due to financial reasons, they are typically run down and need renovating.

This makes abandoned homes attractive properties for investors, flippers and wholesalers because they sell lower than market price.

How to Buy An Abandoned Home

Find an Abandoned Property

In order to buy an abandoned home, you first need to find one — and there are several ways. Here are some options to get you started:

  • Search for houses that look abandoned: This is a straight-forward approach but it’s often hard to distinguish an abandoned home and a vacant home. Common signs of abandonment include overgrown grass and weeds, chipped or faded paint, no cars in the driveway, and structural damage among others.
  • Ask a mailman or delivery carrier if they see any abandoned homes on their routes. Daily carriers are constantly making trips in your neighborhood and surrounding communities. The next time they deliver mail or a package, ask if they’ve come across any homes that look vacant or abandoned. Chances are they drive by one or two almost on a daily basis.
  • Make a trip to the county clerk’s office. The government has records on property ownership so you may be able to find abandoned homes by visiting the county clerk’s office.
  • Look at property auctions in your area. The government seizes real estate property throughout the US due to violations of federal laws. These homes will often be sold at local property auctions so check when/where they are and be sure to attend.
  • Call local realtors and inquire about abandoned homes. Local realtors are aware of abandoned and vacant homes in the area because it can affect their business. No one wants to buy a home next to an abandoned house. So check with a few realtors and inquire if they know about any.

Make Sure It’s Abandoned (And Not Vacant)

At first glance, it might be hard to tell the difference between a home that is abandoned and one that is merely vacant. This is especially true if the home is in a state of disrepair.

The difference is important however, as a vacant home has someone who claims legal responsibility for the house whereas the owner of an abandoned home has forfeited all rights to the property.

For you, this means that dealing with a seemingly abandoned home may be a little easier although most owners of vacant homes don’t live in the same city as the home itself.

You could inquire with neighbors and ask if they know anything about the property or its previous tenants/owners.

Also, public records should include the owner’s address and you, the neighborhood HOA, or even the local government or police department can reach out to the owner to try to reach a resolution on the house.

Track Down Who Owns the Property And Contact Them

The best way to find out who owns an abandoned piece of property is to check your county’s tax assessor website. You may have to pay a small fee but it’s well worth it.

One thing to keep in mind: if the mailing address is the same as the abandoned property, you may be out of luck. There’s a small chance the owner still checks their mail OR they have it forwarded to their new address.

Therefore, you should still attempt to contact them and express interest in buying.

Inspect the Home And Make An Offer

Always inspect a home before buying. This includes abandoned homes.

You have no idea why the home was abandon and it may be because of structural damage, foundation issues, or any number of things. You need to account for the cost of all the renovations to ensure you’ll still make a profit from buying the home.

Once you know you want to buy the home, it’s time to make an offer. You could be dealing with the original owner, a bank or the government. Either way, you need to account for the costs of repair before making the offer.

Should I Consider Abandoned Homes For Sale?

There are some obvious drawbacks involve in purchasing an abandoned home for sale. Although a “Dollar Home” certainly sounds enticing and the homes are certainly sold for very low prices.

However, there is a serious amount of rehabilitation involve before the home will be a safe, healthy, livable residence.

If you are going to purchase abandoned homes for sale, you need to have funds or the ability to obtain financing for repairs. You may need to take out a loan in order to make your new home livable.

Granted, you’ll still be saving money in many cases… but you might end up spending far more than you expected. This is especially true when you consider paying for housing while you’re rehabilitating the home you’ve purchased.

FAQs

1. What is the Abandoned Property Program?

The Abandoned Residential Property Municipality Relief Fund (the “Program”) was created in 2010 under the Save Our Neighborhoods Act. Funding for the Program was expanded by subsequent legislation in June 2013.

2. What are the eligible uses for funding under the Program?

Grant funds may be used for securing, maintaining, demolishing, or rehabilitating abandoned homes. The rehabilitation of an abandoned residential property is strictly limited in scope to address exterior building safety concerns such as repairing the roof, windows, doors, masonry, or walkways of an abandoned residential property.

Final Say

When you buy a home the expectation is that over time the value of the house and the surrounding neighborhood will increase. Unfortunately, forces beyond your control can negatively affect the value of your home and possibly even prevent you from selling it.

We hope this article has been helpful for you. Please share it with anyone who you think will appreciate the information!

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