Last week, I wrote about distressed - specifically, repossessed - homes as fixer-uppers.
Having tried to fix up a couple of old Philadelphia houses myself, with mixed success, I've technically retired from the business. There's nothing like taking a nap in my office on a Sunday afternoon and not worrying about ceiling plaster falling on me.
I know there are experienced investors out there buying and flipping properties, but I was wondering whether any first-time or move-up buyers were doing the same thing.
So I asked Ruth Feldman, a veteran agent with Weichert Realtors'/McCarthy Associates in Mount Airy, what she was seeing these days.
Feldman said she has seen more FHA 203K buyer loans in the last year than she has in a long time.
Basically, 203K loans are those in which you can borrow money for acquisition and rehabilitation of a property.
"The houses these buyers are buying tend to be those needing cosmetic updating, however, rather than the full-gut rehab," she said.
"Those total fixer-uppers are still going to investors - and that market is very active," she said.
Feldman has a listing in which the buyer, who is going to live at the property, is "going to be doing more of a full-blown rehab, and getting a conventional mortgage with money for rehabilitation."
This is not a first-time buyer, Feldman said, and the person has done this kind of project before.
Marilou Buffum, an agent with Prudential Fox & Roach in Chestnut Hill, said very few buyers "want anything other than move-in-condition homes."
"There is an occasional buyer willing to fix up, but only at a very deep discount, and very few of those," Buffum said. "The only people I see looking for fixer-uppers out here are flippers-developers, and they are coming back into the market."
A lot of first-time buyers are, in the words of one of them, going for houses in need of "tender-loving care," and forgoing full-blown reconstruction.
Eleonora Barbieri, with soon-to-be spouse Luis Valenti, is about to settle on a duplex in the city's Fairmount neighborhood that has a couple of rental apartments as well as living space for them.
Of the three houses they looked at, Barbieri said, two were in such poor shape that they quickly moved on to the third.
"We knew what we wanted, and we were realistic," she said.
The absence of buyers willing to do some updating is putting a drag on the market, said S. Clark Kendus, a Weichert Realtors agent in the company's Media office.
Some sellers are "equity-rich homeowners who have homes that last saw updating in the 1980s and that have no appeal to the under-40 demographic who have no interest in anything but a HGTV-like home," Kendus said.
"This inventory sits on and drags the market down with each price reduction," he said.
After years as a fixer-upper, I can understand this aversion to homes in need.
But only after a couple of years of Sunday naps.
In the Sunday Business section, Alan J. Heavens takes a look at real estate and life throughout the region. This week's focus: Collegeville. EndText