Housing News
Buying a home at tax sale may not be such a deal
(Housing News) It has become a popular notion that a home bought at a tax sale is a steal, but it is not so black and white – let’s dig deeper into the advantages and disadvantages.
The Property Sold at Tax Sale
If you have ever been channel surfing at 3:00 a.m., then you may have seen a commercial or an infomercial about buying home for as little as one thousand dollars. Perhaps you thought to yourself: where are these deals and how come I’ve never seen them in my own neighborhood?
These amazing deals that you hear about on television advertisements are tax sales. That is, when a homeowner defaults on his or her property taxes and after many warnings to the homeowner and the mortgage lender, the government has the right to sell the property at a tax sale for the amount owed on the taxes.
What You Really Need to Know About Tax Sales
Perhaps you’ve heard that you can make a killing buying tax sale properties. That may be true, but you need to understand the risks involved in such an endeavor.
- Sales Don’t Happen Daily. Generally tax sales occur once a year and the prospective properties for sale will be listed on a government website.
- Right of Recision or Redemption. Despite all the warnings that the homeowner has received about a pending tax sale, most states provide a grace period after the sale in which the homeowner can get current on their payments. So even if you purchased the property at a tax sale, the previous owner still may have a redemption or recision period.
- Tax Lien vs. Tax Deed Sale. Each state has different laws regarding the timing of these sales and the sale may be a tax lien sale or a tax deed sale. Before you make a bid, understand the difference between the two. In a tax deed sale, the investor buyer purchases the deed. In a tax lien sale, the investor purchases the lien and often tries to collect from the previous owner, who wants to remain in the property.
- Mortgages. If the previous owner had a mortgage on the property, investor buyers must investigate this mortgage. While it may be wiped out by a tax sale, will the mortgagee be claiming that the tax collector didn’t alert them to the sale? Might there be some issue with the mortgages that will cloud the title?
Even though I’ve seen lots of infomercials about the benefits of investing in tax sales, I’m not sure that those advertisements mention that you cannot buy a home at tax sale and turn around and sell it tomorrow for a large profit. As with anything, there are serious risks involved in this investment. If you plan to invest a few grand in a property sold at tax sale, seek legal counsel so that you fully understand the risks versus the rewards.
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Housing News
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
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Housing News
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.
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