There are currently more than 1,100 of them in the Portsmouth area, according to figures compiled by Debbie Gambill, a realtor with Century 21 in Portsmouth.
“I’ve been in the business here 21 years and it’s the worst I’ve ever seen,” Gambill said.
Foreclosure is the process by which a lender or bank repossesses a home from the owner because the owner failed to make payments on the home loan. These “bank-owned homes,” although offering some good deals for buyers, often sit empty for a lengthy period.
A drive about Portsmouth, especially in the east end, reveals sometimes three or four houses on a block that have been foreclosed on, their windows often boarded up to protect the glass from vandalism. Grass grows tall in the yards and flower beds.
“Lenders don’t want to hold these properties. But they’re not in the real estate business, they’re in the lending business,” Gambill said.
Buying property that’s been foreclosed on usually differs from purchasing a non-foreclosure property. They have longer closing periods and require additional paperwork to release the home from the bank.
And, too, if foreclosed houses are priced below market value, multiple offers are generally submitted and purchasing the foreclosure becomes more competitive.
“There are some incredible opportunities for buyers right now,” Gambill said. “A young couple starting out can not only get a house marked at below-market price but qualify for the first-time home buyer credit. They can get credit from the government for remodeling.
“It’s a good opportunity, too, for people who are investors and have a crew put together to convert something into a rental. This could be an opportunity that we may not see again.”
But the downside of foreclosures and houses standing vacant is the increase in crime that has come with it. Houses are being stripped of their air-conditioning and heating units, copper plumbing and whatever else thieves can get to.
“It’s not just happening to foreclosures, but empty houses listed for sale through the normal procedure,” Gambill said. “A property which I have listed on Gilbert, which is a great street, had the air conditioner stolen. A $259,000 house on Chariot Way had the AC stolen.
“It is horrible what’s happening to these foreclosures and other empty houses. A house may be empty for a year. The crime element is attracted by it. The people addicted to drugs are going in — sometimes in broad daylight — to steal things to sell to get money to feed their habit. There are houses in the city where there’s just the shell left,” Gambill said.
Foreclosures are apt to be an everyday occurrence in the current housing market, Gambill and others in the business agreed. It’s an unfortunate and unpleasant process for people trying to hang onto their homes, but it offers home buyers an opportunity to get into a home they might not normally be able to afford.
Some foreclosed homes are sold at auction or a sheriff’s sale, while others are sold in individual transactions like any other home for sale. Buying a foreclosure property can be the quickest way to get into home ownership.
Gambill and others listed some tips for people wishing to buy a foreclosure:
• See the house for yourself.
• Choose a lawyer or realtor who is well-versed in the foreclosure buying process.
• Hire a home inspector to make a list of what needs to be repaired.
• Line up financing and lenders about getting pre-qualified for a mortgage.
• Find out as much as possible about the neighborhood you are considering.
G. SAM PIATT can be reached at (740) 353-3101, ext. 236.