Even in affluent communities, foreclosures often offer a chance to buy a luxury home for as much as 40% or more off the market valueAt the end of 2006 a new 4,000-square-foot home with a three-car garage in a small gated subdivision in Las Vegas sold for $1 million. On May 6 the bank that owns the now foreclosed property at 7604 Noche Oscura Circle agreed to sell it for $500,000 ($32,900 below the already discounted asking price).
Banks—particularly in hard-hit real estate markets such as Arizona, California, Florida, Michigan, and Nevada—are slashing prices to entice buyers and clear away rising inventories of homes. The banks are competing with desperate builders and sellers facing foreclosure and, as a result, bargains are abundant, especially for buyers with strong credit, ready cash, and a willingness to take a chance on markets in free fall.
The Las Vegas house was near the top of a list of 25 high-end foreclosures with deep discounts compiled for BusinessWeek.com by RealtyTrac, an online foreclosure listing service based in Irvine, Calif. "It's an exceptionally good deal," Dillon England, an agent with Las Vegas Realty, said of the house, which is listed with his company. "What holds a lot of people back is when they walk into a small, 20-home subdivision like this one that has eight foreclosed houses.… It would scare you, wouldn't it?"
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