There has been a lot of talk about the low levels of inventory making it difficult for buyers to find homes and creating additional competition in the market, not to mention increases in sales prices. Predictions are now in that the amount of HUD homes available on the market will be increasing dramatically over the next two years.
According to an article this week in the Daily Real Estate News, “HUD-Owned Homes Expected to Surge”, the U.S. Department of Housing and Urban Development is reportedly going to be releasing more of its homes to the market, which could be welcome news to buyers who have faced slim pickings in for-sale inventories.
“The inventory is there, [it’s] just not being released during the banks/servicers review of the loan/mortgage documents,” says Nat Genis, a HUD listing broker in Riverside County, Calif., which is already seeing an increase in HUD-owned homes. “HUD homes are back,” Genis told HousingWire. “FHA financing went away with the ‘creative’ financing of the 80/20 loans, and now with the increase of FHA financing, these government-backed loans guarantee that if the borrower defaults, HUD will pay off the mortgage, obtain the deed, and re-sell the home.”
According to HUD, they had 39,442 homes in its REO inventory nationwide as of Feb. 28, 2013—with 20,536 of those having pending contracts on them. Almost 19,000 homes across the country.
We often see these homes come on the market in poor condition (we can also mean lower prices) and with the availability of 203k rehabilitation loans, there are more opportunities for buyers who can’t make cash offers.
You can find HUD homes listings on the HUD Home Store and they are usually advertised on the MLS. To submit an offer on an HUD home you will need to work with an qualified real estate broker who is registered and has an HUD issued NAID number. I would be happy to help you in purchasing an HUD home or referring you to another qualified agent in your area, please contact me for assistance.
(BTW, the photo is “the Singleton House” by Richard Nuetra which was on the market last year for $17,995,000 and is definitely not a HUD Home.)
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