Sedona Foreclosure Properties: 10 Tips and 5 Facts
Are you interested in Sedona foreclosure properties? We've sold quite a few foreclosure properties in the Sedona Arizona area over the years. A question we get is 'how was Sedona real estate affected by the recent recession?'. Sedona did have a fair number of foreclosure properties, but nothing like Phoenix and Las Vegas. The number of foreclosure properties in Sedona began to decline beginning of 2012.
Right now we average about 2-3 foreclosure properties in Sedona at any given time. We can't put an average price on the foreclosure properties in Sedona as we have both ends of the market. The home that is close to being bulldozed and the pristine Sedona luxury home.
10 Tips For Buying Sedona Foreclosure Homes
- Check the market value of the home.
- Banks are all about the money. They have no emotion or attachment to the property. Expect to see price reductions every 30 days or so. If the foreclosure properties price is reduced far enough, it can be a great deal. You just have to be ready when that happens. We see bank-owned homes or REO properties, sit on the market for months and then when the price is reduced enough it becomes a bidding war.
- Visit the property. Do not buy a foreclosure without seeing it in person and without a home inspection clause. Pictures and videos may not convey the full picture.
- How's the neighborhood? Is it the small dumpy house among the bigger more expensive houses or just the opposite? Look for future value.
- Is the condition acceptable? Deferred maintenance goes hand in hand with financial difficulties. What's it going to cost to get it back in shape. Has the property been stripped of appliances and fixtures?
- Can this home be financed? Something as simple as missing carpet in a bedroom may stop financing. We can work with you to find a foreclosure property suitable for a mortgage.
- Is it vacant? It should be, but on occasion, we've seen where the previous owner may move back in. Squatters are another possibility although very, very rare in Sedona.
- Was the property winterized? Typically a foreclosure property is sealed up when the bank takes possession and part of the process is to turn off all utilities. If it wasn't winterized you could be surprised by burst water pipes
- How's the landscaping? If it's summer in Sedona and the water is off the plants will die. The drip irrigation system (probably broken) will not be running.
- Do you want to flip the foreclosure property? Make sure it's allowed. The FHA and some banks may have a clause to prevent quick sales and flips. In Arizona, you will likely need a General Contractor (see Arizona Registrar of Contractors AZROC) to sign off on the repairs.
Graph of the number of Sedona foreclosure properties from 2009 to 2019
Sedona Foreclosure Homes Sold by the Year
5 Important Facts To Know When Buying Sedona AZ Foreclosure Properties
- In Arizona, the primary method of a deed of trust foreclosure is non-judicial. Arizona law doesn't allow the redemption of the home after a nonjudicial foreclosure. In a number of states, the previous owner can redeem or repurchase the home within a period of time after the foreclosure (Alabama is 12 months). This would definitely put a crimp in any plans to repair the home prior to the expiration of the redemption period. Not a problem in Arizona though.
- The foreclosure of a property in Arizona should clear the Title of liens. You will receive a Special Warranty Deed. If you sell the home later, it will transfer as a General Warranty Deed. You still want Title Insurance just to be safe.
- Don't expect the bank to do any repairs. They sell foreclosure properties in 'As Is' condition. Rarely are they negotiable on this unless it has a poor roof condition that will affect the appraisal. Even then it's not a sure thing that they will do the roof repair.
- Don't expect any disclosures on the foreclosed property. The bank will disclaim any knowledge about the home or its condition, past or present. This is why a home inspection and a title search are so important. You may want to go beyond the home inspection and order special inspections, i.e. roof and HVAC systems.
- The bank has it's own way of doing things. They will likely demand to use their own purchase contract which will not be favorable to you and even may insist on using its own title company. A common clause in any bank's contract will penalize/fine you for not being closing on time yet no such penalty exists for the bank. Expect a longer closing time-frame than normal and possible delays.
As you can see, buying a Sedona foreclosure property may be a bit more work than a regular home purchase. It can be worth it though at the right price if you don't mind doing repairs or hiring a contractor. We have the experience in foreclosures to help guide you through the maze of buying a Sedona foreclosure home and point out some of the pitfalls.
Call us today and we will set you up with a custom MLS foreclosure home search. 928-301-4949