Expert: Jane Doe Date: 4/1/2008 Subject: Lots of time, little money.
Question QUESTION: I am in the south east corner of LA county, 10 mile radius centered on Walnut CA, and I am looking for an inexpensive home on proerty that I can purchase for very little, meaning $20,000 or less, that's in a good condition and area. Also, I have nothing but free time, over the next 12 months, to attempt this search, so I can go where ever there are important records, quite often, if I only knew where to poll for information.
I'm just starting out on this new "quest", because I am disappointed by the, "homes and land" or "pennysaver" type papers and newspapers, by HUD listings, by Yahoo real estate high misprints rates, by home auctions, and because I haven't currently found the right departments in the local cities government buildings for appropriate information. And already have looked for 4 months by these use-less methods.
The question is, what datas, governing places, names of departments, and such, are there, that I may follow in my districts, either directly due to branch departments, or by closest local cities' equivalents, so I can track down such a home, by using my free time, but having sparing money? I can really spend a long time looking, but don't like wasting time and effort needlessly on the wrong places and data that is rife with spam corrupted data, or continuously lists mobile homes as foundation homes ... does anyone label their data entries correcly, when they have the data filtering options on a page? Hmmm, greed, or, at the least, negligence.
ANSWER: Hi Sean:
Being a licensed realtor, I don't have first hand knowledge of the types of hard databases outside the usual agent services, title and public records (recorded information), but you are not the first person I have heard complain about the out-of-date entries and inaccuracies. I've also heard of the many schemes and frauds found in papers and on the web. I guess that is why people use licensed real estate professionals. From experience, what jumps to mind when reading about your quest is the stories I've heard of so many that have wasted huge amounts of time and energy searching for something that may not exist. In conception it sounds reasonable and worthy of trying, but it is possible that with the recent events in the lending industry, lenders may be even less likely to grant no down or extremely low down loans and sellers/private lenders could be less likely to trust as well. When I see you are looking for this needle in a haystack with almost no down, in good condition and very inexpensive, it is a red flag to me that you may not find it. If it does exist, it would be picked up by networking, not sitting in a database, snapped up by inside knowledge. Logic dictates that one way or another, if desirable, they bring close to market value, whatever that may be at a given time, especially in Los Angeles County. I've done my share and my dad was a broker for over thirty years and it has always seemed to me that real estate just cycles and the above has always seemed true. If desirable, market value unless there's inside information, like buying from a family member and getting a great deal or something like that. Good luck with your quest. --V
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QUESTION: I was kind of afraid the probability might be near zero on this low total-price quest, not down payment, outright cash purchase is my goal. Might be rare, but this year I have seen desert properties for 10-30k, and mobile homes on 1/4 acre property lots for 50k for home in cities like Needles and Blythe, with garage and the land with utilities ... but all just are not local for my line of work. And looked in Phoenix and definitely found 60k and 80k homes with the land, not mobiles.
*However*, if I used an agent, like you suggest, and had a relaxed 12 month observation window, in areas with 500k-750k homes like Walnut, Rowland Heights, and Diamond Bar in and around SE LAC, what would the lowest statistical home price look like ... that 1 in ~60,000 [homes/year] in that area? Like, 60k, 100k ... ??? And, wouldn't the agent be highly unmotivated to help, tho' because the time looking is long, and the %commission would be very small on, say, a 60k total-purchase not down-payment home.
Also, I would think in a year, that there would be at least one person pass away without family, or a police drug repossession home, and the state takes ownership of a fully paid-for home ... hmmm, what data "title" are these under? Do I have to go to Sacramento itself??? Maybe an agent with access to state records? Does the state sell the home for very little in those cases, as they can't resell a paid for home, or are they in one of those state auctions, or police auctions, and who is legitimate in all the "snow" on TV and web ... an agent, again?
Thanks for the title and public records names, at least it gives me the right words before visiting local city halls. I think I've heard of tax lien records too, I might hunt that department down, too. Quixotic, as it may be...*grins*
Answer Yes, you bring up a viable point. From agent's point of view, have to use time, effort, resources in the most profitable fashion. It can be the same amount of work for a $20Mil home as a $100K home for the agent.
Remember that seller pays agent fees, so it never hurts to inform agents of property in which you are searching and just tell them to contact you if they hear of something. If you send along your full name and email, I will put out a global email blast and voicemail to thousands of agents with your buyer request. That is very quick and effective, with little effort on my part. (What did we all do before the Internet and cell phones?) Agents are so out and about, mixing it up, and hear of all sorts of things, often by accident. Then some of the other things you mentioned can lead to availability. The web should have the various statistics you seek, as an agent probably would not want to put in a lot of research time providing information when there's little or no payoff. All so busy these days. I would check California Department of Real Estate, California Association of Realtors (I don't know if they provide guests/non-members access to the info), government housing websites, state and local building and safety, County Recorder, obituaries, local newspapers for private sales, network like crazy with people, and local organizations asking everyone if they know anyone that wants to sell, even put a wish list on some of the bargain websites with your search criteria and see if anyone responds. If you know of streets you like, walk it, knock on doors. Can put flyers on doorknobs or whatever.
Remember that whether or not a seller is a lender, institution, company, corporation, private party or court auction, unless a fluke, usually sales approach market value. I just sat through a meeting where they showed media/commercials claiming unbelievable purchases at auctions and such and then they showed us the real data/statistics. You just can't believe everything you read or hear.
If you are willing to buy in some of the harder hit areas, you may just find your needle in the haystack, so don't give up too soon, just decide how much time/effort investment you can afford. Sometimes one can chase their tail, pass up a home that is well priced, looking for a fictitious outrageous bargain and lose in the long run by waiting, skipping the gained equity by buying and flipping at the right time. That can often result in a lot more money at the end of the path.
--Val West of Nelson Shelton of Beverly Hills, 310-271-2282 Ext 400
