Houses You Can Buy For Practically Nothing

Posted by: Chris Palmeri on October 14, 2009

house in detroit.jpg

The real estate industry is justifiably worried about what will happen to home sales if the $8,000 credit for new home buyers is allowed to expire on Dec. 1. After all, car sales plunged when the Cash for Clunkers program ended. Realtors have been lobbying pretty hard to extend the credit and broaden it to all home buyers.

Realtor.com just came up with a list of houses you can buy for $8,000. The site says there are about 200 such listing nationwide, of the four million the site tracks.

Such properties will likely need work. And closing costs will be about $2,500, but that shouldn’t be a deal breaker. Look at that five bedroom, bank-owned beauty in Detroit up above! At 2,000 square feet that’s $4 a square foot, land included. Come on, someone’s going to make money on that.

ADDENDUM: Some astute readers noted that Realtor.com got a little ahead of itself in compiling the list. The tax credit is 10% of the purchase price of the home up to a maximum of $8,000. So for an $8,000 house, the credit would only be $800.

Reader Comments

Avery Hung

October 14, 2009 9:46 AM

You won't get $8000 tax credit from the government because the tax credit is equal to 10% of the home purchase price up to a maximum of $8000.

Devendra Sood

October 14, 2009 11:07 AM

Chris,
A good article. Do you contact info for Boston? Who can I contact for finding out if I can qualify to buy one of such homes as you have shown in Detroit in or around Boston area?
THX
Dave

Brar

October 14, 2009 12:25 PM

Here we go again. Get out and take a house tour before you talk further. No offence, but very likly you will turn back after setting foot in the neighbourhood, ... leave out taking tour de house.

V

October 14, 2009 12:38 PM

Actually, the $8000 credit is 10% of the purchase price - to quote the IRS

"This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately."

So you have to buy a home for $80,000 minimum in order to get the full credit. If you buy an $8,000 home you only get an $800 credit.

http://www.irs.gov/newsroom/article/0,,id=204672,00.html
Do better research next time.

123xyz

October 14, 2009 1:31 PM

But these houses are priced low for a reason. Take that house in Detroit. Detroit? People are leaving Detroit is droves. There's no jobs. The city government had been corrupt. Besides, that house is just a couple of door away from a major freeway!

The owners should be paying you to take it!

Sami

October 14, 2009 1:48 PM

Except the credit doesn't work that way.The government will refund 10 percent of the price of the home up to $8,000.

Aygun

October 14, 2009 2:41 PM

Is it a joke?

Howard Nugent

October 14, 2009 2:53 PM

Unfortunately, the credit as it's worded now is for 10% of the purchase price, up to $8,000. So on a $8,000 home, that's only an $800 credit.

Squeezebox

October 14, 2009 4:02 PM

I think there's FHA loans and grants available for the fix-up, too! Just beware of the neighbors! These houses tend to be in high-crime areas.

Andrew E

October 14, 2009 4:22 PM

Hey that's my house! If you're not into bat dung, then don't look in the basement.

Chuck Gaffney

October 14, 2009 5:01 PM

As somebody who's wanting to buy my first home, this is wonderful news. Sadly, my area didn't get the hint about correct housing prices.

When this house goes for $215K
http://www.realtor.com/realestateandhomes-detail/2860-Doncaster-Dr_Canton-Twp_MI_48188_1112986586

...while this house goes for $250K
nearby

http://www.realtor.com/realestateandhomes-detail/Selden_NY_11784_1112055308

...you know there is something very wrong with my area's real estate prices.

Brittany Clark

October 14, 2009 5:18 PM

The rebate is 10% of the value of the house, up to $8000.

Brittany Clark

October 14, 2009 5:18 PM

The rebate is 10% of the value of the house, up to $8000.

Shirley Bililngsley

October 14, 2009 5:40 PM

http://land.vstore.ca will have houses that you can buy also, for 5000.00 cash money. They will be online during the next two days.

Gavin

October 18, 2009 6:28 AM

The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000. So for houses valued so low I don't see how it nets out to a 'free' transaction as you would not get an $8000 credit. There's a host of other restrictions on the rebate as well.

Alfonso

October 21, 2009 3:31 PM

It's a great time to buy real estate because prices are lower in most markets than they have been in recent years. The tax credit is just icing on the cake, if you qualify.

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About

BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.

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