Buying a Second Home in a Sagging Market Can Be a Challenge
It’s a buyer’s market when it comes to real estate, so you’d think buying a second home would be a breeze. But that’s not always the case.
You may run into things like unpaid maintenance fees, hidden property damage and delayed closing dates. Sellers struggling to make mortgage payments also are often in arrears on property taxes and other obligations such as municipal permits for construction.
The seller's lender, for example, might agree to take a lower price, but refuse to pay the back taxes. Haggling over things like that can seriously drag out the time before closing.
To avoid any problems, a title search is a must. Hiring an experienced real-estate attorney or title company to do the search is critical.
Getting a home inspected is also particularly important when buying from a homeowner who is financially strapped. An inspector will assess damage, but a seller who is struggling to meet mortgage payments isn't likely to be able to cover repairs -- so prospective buyers have to decide whether they are willing to foot the bill.
Thinking about buying a condo? Make sure the condo association is solvent when considering buying a condo unit. Maintenance fees may have gone unpaid if not, and buyers may end up forking over hefty fees to keep it afloat.
In general, home buyers should be ready for lengthy negotiations and more than the usual share of setbacks when getting a bargain on a second home. These often arise when a distressed seller puts a home on the market without telling his lender.
– By Ed Coury, senior editor and Midwest bureau chief for the Wall Street Journal Radio Network, Dow Jones & Co., and a reporter for WWJ Newsradio 950.
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It’s a buyer’s market when it comes to real estate, so you’d think buying a second home would be a breeze. But that’s not always the case.
