- The Washington Times - Friday, November 20, 2009

For homebuyers looking for a bargain, lifeless homes that sit empty for months can be appealing because of their low price tags. With a record number of foreclosures and sluggish sales forcing some owners to move out before their homes sell, there are vacant homes in just about every neighborhood in the Washington area.

According to the U.S. Census Bureau, the number of vacant homes in the nation - including foreclosures, residences for sale and vacation properties - rose to 18.8 million in the third quarter.

There are currently vacant homes on the local market in all price ranges, according to Yolanda Muckle, a Realtor with Long & Foster Real Estate Inc. in Mitchellville who has appeared on HGTV’s “Get It Sold” program. Depending on the condition of each vacant home, Ms. Muckle says some of these listings are good values for buyers.

However, the condition of a home is an important consideration. Industry professionals advise buyers to do research when it comes to purchasing a vacant home. In many instances, a vacant house is an “uncared-for” house.

J.D. Grewell of J.D. Grewell & Associates Inc. is a home inspector in Silver Spring who has been in the business for more than 30 years. He said that there is a huge difference in homes that are vacant and bank-owned and those that are vacant and still in the hands of the owners.

He explains that owners don’t typically shut off the power, gas and water in a (vacant) home for sale. However, banks often shut off utilities to save money.

Mr. Grewell recalls a house he visited recently where the basement flooded because the power was off and the sump pump didn’t come on when water penetrated the home.

“When we walked downstairs, it smelled like mildew. There were water stains 2 feet high and mold was growing on everything,” said Mr. Grewell.

He added that the Federal Housing Administration will not approve a mortgage for a home with mold problems.

Tim Bills of Sentry Home Inspections LLC in the District said it’s not uncommon for him to inspect two or three foreclosures or short sales per week now. He said that mold and moisture issues are the top problem in vacant homes.

Moisture issues in basements and crawl spaces can contribute to building structural problems and lead to potential health problems, he added. There can be other potential problems lurking in vacant homes too.

“I see interior damage from leakage, frozen pipes, vandalism and inoperative or seized appliances,” said Mr. Bills.

Buyers may also have to worry about damage to a home by angry owners who were forced to leave. While missing doors, botched appliances or a toilet ripped out of the wall may be obvious signs of damage, lack of maintenance and needed repairs may be hard to spot.

Ms. Muckle said that in the case of most foreclosures, banks sell the properties “as is.” She has shown foreclosed homes that have had mold problems, as well as damage inflicted by upset owners.

“Some properties have missing appliances and holes left in the wall,” Ms. Muckle said.

Most of the vacant homes she has shown are empty due to foreclosure, but a few are vacant due to homeowners who have relocated or downsized without being able to sell their home first.

Buyers should also be aware that empty homes are susceptible to being vandalized and may have wildlife living in the attic, crawl space or basement. These are all things buyers should check out when determining whether a vacant home is really a good deal.

“I wouldn’t go so far as to say that just because a house is vacant that it is a good value,” said Susan Mekenney, a Realtor and associate broker with RE/MAX Allegiance in Alexandria, who is also chairman of the board of the Northern Virginia Association of Realtors. “There are many occupied homes that are ‘as good’ of a value - if not better.”

She said that it’s hard to generalize about the value of vacant homes since each property has its own positives and negatives; however, she said that many vacant homes have not received much “tender loving care” and will require a lot of sweat equity and money to make necessary repairs before new owners can comfortably live in such a home.

Ms. Mekenney said that it’s been her experience that many homes are vacant due to foreclosure (or pending foreclosure), but you can’t assume that’s true of all vacant homes.

“Vacant doesn’t necessarily mean foreclosed,” she said. “It could mean the property is on the market for rent, it could be an estate sale where the owner has passed away or it could be that the owner was transferred and the property has yet to sell or rent.”

Buyers should try to learn the history of a property. However, Ms. Muckle warns it can be tough to get any details if a property has been vacant for months due to foreclosure or if the owners moved away. Sometimes, neighbors can be the best source of information about a vacant home.

Home inspections are another valuable way to find out about a home. An inspection would reveal any structural problems that resulted from neglect or wear and tear, according to Ms. Mekenney. She added that with properties that are vacant and bank-owned, there often isn’t anyone to disclose defects that would normally be disclosed in a traditional sale.

“Even if the property is being sold ‘as is,’ I would recommend a home inspection - as well as a possible pre-inspection - by a home inspector or contractor to receive estimates on the cost of repairs,” Ms. Muckle said.

Mr. Grewell explained that a pre-inspection is a limited walk-through that usually takes about an hour, while a full inspection typically takes three to four hours.

“In this area, the home inspection typically will be a contingency of the sale,” said Ms. Mekenney.

Once both parties have agreed to the terms of the offer, signed off on and ratified the contract, then the home inspection contingency kicks in and occurs.

Mr. Bills normally schedules inspections five to seven days after a contract has been ratified. He said that pre-inspections are not uncommon; however, there is a greater risk of not securing a ratified contract in this situation.

Finding a good, quality home inspector is important. Mr. Grewell advises buyers to start their search at the Web site (www.ashi.org) of the American Society of Home Inspectors (ASHI) because not all inspectors are qualified for the job, nor do they all meet the minimum standards.

Mr. Bills agrees that buyers must be vigilant when purchasing a vacant home and choose an ASHI-certified home inspector.

“Certified home inspectors are trained in finding problems and will look for many things an average homebuyer would not think of,” said Mr. Bills.

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