Photo courtesy of Zillow
Don't run away when you see a $25,000 price tag on a house. But proceed with caution.
The explosive growth in home prices we've seen over the past two years is slowing down, and there's still a backlog of cheap properties on the market. But unlike the heyday of the housing crisis -- when decent homes were selling for a fraction of what they were worth -- the quality of today's cheapest homes is a little more of what you'd expect for the price of a down payment on most other homes. If the price on a listing seems too good to be true, there are probably a few hidden (sometimes even obvious) problems prospective buyers should consider.
For example, in Atlanta, $27,500 will get you a six-bedroom duplex -- but there are chunks of the walls missing. You could buy a three-bedroom ranch house in Chicago, if you're comfortable with the high crime rates on the South Side. A two-bedroom home with indoor pool and Jacuzzi access can be yours in Phoenix for $25,900, but you'd have to pay an extra $425-per-month fee to the mobile home park and be 55 or older.
When buying a home for under $30,000, research is key. Consider the location and its potential for growth. Is this an area that's poised for growth? How much work is necessary to improve the property? Does it need a facelift or an overhaul? For this kind of price, it's worth spending a bit more on a lawyer who can make sure the property is up to code and cleared of any tax liens. You should also invest in a good home inspector that will really put the property to the test. Even at $25,000, some homes just aren't worth it.
Here's what you can buy for under $30,000 in 10 places in the U.S.
"What can you buy" is a series that looks at what type of house and amenities you can get at particular price points in various locations across the U.S. Be sure to check out a few of the other posts in the series: What can you buy for around $300,000?, What can you buy for $40,000?, What can you buy for around $100,000?