Buy A Foreclosure For Under $1,000. A Little Sweat Equity Needed

by Scott on January 11, 2009

Abandoned

photo credit: James Jordan

Here in my California neighborhood we have our share of foreclosures, but none are as cheap as $1,000 yet. I say yet, because it is still a roller coaster ride that has yet to find a bottom. A yahoo article caught my attention that lists several cities where you can purchase a home foreclosure property for under $1,000. If you live near these cities I would be interested to hear what you think about this opportunity. Is this a great way to entire the rental income market or gain an amazing deal for a first time home buyer?

Cities hit hard by foreclosures and selling homes near $1,000

1. Flint, Michigan
2. Indianapolis, Indiana
3. Cleveland, Ohio
4. Detroit, Michigan

Banks are so inundated with inventory that they are marking down properties in an effort to clear inventory. If you lived in these cities, would you be tempted to purchase a foreclosed home like these? I think about the neighborhoods, schools, maintenance, upkeep, and rental market, but still at $1,000 can a deal be had? Buying a distressed property and making some upgrades can be a wonderful income building opportunity for residual income. Rental real estate can be a fantastic passive income opportunity for your family and future generations. It has been tempting to invest in the condo market here as many properties are starting to list for under $100,000. We are still a long way from a $1,000 home in our area, but our current prices have got to start getting enticing for investors.

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January 14, 2009 at 7:30 am

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1 heidi January 11, 2009 at 7:40 pm

I think that if you were willing to do some work on the house and invest a little to clean it up it would be worth it but really it would be some work. I know two people who have had their houses foreclosed on-it is very sad.

2 jj-momscashblog January 11, 2009 at 8:29 pm

Hi Scott, Glad to hear from you again, hope all has been well with you. I think if I had a chance at purchasing a home for $1000 I would like to think that I would jump at the chance. It would definitely be a great opportunity if you had some extra money to put into it for renovations and turn around and sell it. I’ve always been intrigued by the thought of flipping houses so I would love to see a house for that price in my area. However it’s also sad to see all of these houses/homes that once had a family living in it and are now standing there empty and deteriorating day by day. Rental income would be great and I’ve also thought about that too. You think I’m kidding I’m not, I will see a building downtown that was once a store long put out of business by the big box stores and I see making it into great apartment buildings, I guess after reading my comment here and my ramblings I think I must always be looking for ways to make that “passive income”.

3 pfincome January 12, 2009 at 4:41 am

I use to live about 30 miles outside of Detroit and still have family that work in the city. While I think that you can find some great deals on homes as you mention, you also have to think about the safety of the home. Things are so bad in that area right now that people are stealing copper and anything of any value in these homes. If you start to put money back into a home like this, you may be risking you safety. I guess it depends on the area you would make the purchase. I would also say that Flint Michigan is probably worse than Detroit.

4 Greener Pastures January 12, 2009 at 5:12 am

Use the house for firewood, and sell the land! Really though, foreclosed properties make me nervous. Friends of mine got what they thought was a good deal, but there were so many hidden problems, it became a lot of work. They figure they broke about even, when they called it a day on repairs. They do love the house now, but said they’d think twice about doing it again.

5 Scott January 12, 2009 at 11:11 am

@ PFIncome

Would love to hear more about living near Detroit as this area seems to be hit hard by this economy. We have also had stories of people breaking in and stealing copper, appliances, and AC units, but not on a widespread basis. $1,000 seems awfully cheap for these properties no matter what the condition. I wonder if you can rent them out and if so, how much.

@ Greener Pastures

Did your friends have an inspection or a contractor look at the home before they purchased it? I too am nervous about buying a foreclosure and think some additional steps should be taken. Just as we would take a used car to a mechanic for a once over before purchasing from a third party. Although, you can also negotiate a lower price if you are buying as is.

6 joe_sblg December 23, 2010 at 8:31 am

I want a damn freaking 1000$ home, im 20… I live in QC, Canada, I got 2.6 grand in my acc bank, buying a house for 1000 and doing a “make-over” and sell it would be a huge boost for me and I would also loveeeee to get a 1000$ home… (my gand-parents bought their for 5000, but they bought it back in the 1940~ish) my jaw simply dropped when I heard that ad, anyone can help me up find a site where I can buy these home? I would really love to take a peek at those house and see for myself, like we always say, “you gotta see it to believe it” well I wanna see it and Im willing to take a 12-14-20ish hour ride just to check on a 1000$ home

7 brian laxton June 17, 2011 at 8:17 pm

looking 4 houses 4 $1000 or less

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