Does anybody make money buying new forclosed houses in Vinyl Villages? - Posted by Brian

Posted by Russ Sims on January 27, 2000 at 16:50:35:

I really don’t know of an easy way to tell: I always just ask the owners. Disclosure laws here compel them to tell me if it is.

If there is some doubt, you can always call a siding company out and have them inspect it. My brother, who is in the business, says that this is something that should be done for free. After all, you are a potential customer…
Russ

Does anybody make money buying new forclosed houses in Vinyl Villages? - Posted by Brian

Posted by Brian on January 26, 2000 at 08:41:32:

In my area I am beginning to see quite a few hud and fannie mae forclosed houses in the newer tract home subdivisions. I am sure that these are the houses that marginal people bought with no money down from the builder using FHA/VA, etc. I think I can pick some of these up for around 75% of market value and they need minimal repairs because the houses are only 2 to 3 years old. I am only concerned about this type of community “Vinyl Village”. Comparables are easy but I am not sure of the market for these types of homes and appreciation rates. I think that worst case scenario I will sell on land contract or L/O.

Does anyone else have experience in this area?

Brian

Another approach - Posted by Bud Branstetter

Posted by Bud Branstetter on January 26, 2000 at 10:39:29:

The newer houses like this if they are in the middle to upper subdivisions are also good for lease options and subject to deals. If you get there before they foreclose you don’t need the capital to buy afterwards.

Re: Does anybody make money buying new forclosed houses in Vinyl Villages? - Posted by JD

Posted by JD on January 26, 2000 at 10:07:07:

I am always suspicious of comps on brand new homes (since I got burned once). But, IF you can buy them at 75% of FMV, buy and sell as many as can find. As you alluded to, the vast majority of those newer homes are purchased with little money down, by the time the property has gone though the foreclosure process the balance owing is almost always greater than the FMV of the property. And, because the properties are in good condition, it is unlikely the bank will discount significantly.

Re: Does anybody make money buying new forclosed houses in Vinyl Villages? - Posted by Russ Sims

Posted by Russ Sims on January 26, 2000 at 11:42:35:

Just make sure beyond a shadow of a doubt that the homes don’t have LP siding. Even the “good” LP siding is bad…I say this because around here if a home was built 3 to 8 years ago, there’s a good chance the siding is LP. And on a 2000 sq ft home, that’s a 8 to 12K problem and savy buyers will always ask about it.

What is LP siding? - Posted by GL

Posted by GL on January 26, 2000 at 16:52:57:

Is it old vinyl records nailed on like shingles?

What about that stucco stuff that rots the house out? Have they got a cure for that yet?

Re: What is LP siding? - Posted by Russ Sims

Posted by Russ Sims on January 26, 2000 at 21:42:03:

Yes, you hit the nail on the head: LP siding is what comes from having millions of useless old vinyl LPs floating around. Some rocket scientist got the idea to put them to use by buying them up at a nickel a piece and then nailing them to the sides of houses…brilliant!

LP actually stands for Louisiana Pacific, the not so bright wood products company that developed a home siding that let moisture through to the studs of a home. Major rot ensued. That stucko stuff is bad too!

How can you tell LP siding?(NM) - Posted by GL

Posted by GL on January 27, 2000 at 07:08:23:

?