Buying Sight Unseen – The Big Risks
That Low Price May Hide Some Nasty Surprises
A lot of investors find success when they buy properties sight unseen. Even so, there’s a lot of risk attached. A buyer’s agents in the Eastern Suburbs, North Shore or Inner West can help. Even so, you’ll always have some unknown factors to deal with when buying sight unseen. Even the best auction bidding tactics fall down if the property ends up being horrible.
So, how can our buyer’s agents in the Eastern Suburbs, North Shore or Inner West help? We can start by offering you some advice so you understand some of the risks of buying sight unseen. Before that, let’s look at what the sight unseen term means.
What is Buying Sight Unseen?
The sight unseen moniker is a little misleading. It means you won’t have the chance to visit the property in person before buying or placing a bid. However, you can still see some of what the property has to offer.
The property’s listing will give you the basics. Photographs and virtual tours will help you figure out what the property looks like. None of this can replace an in-person tour. Nonetheless, you don’t go into the process without any information.
Investors usually buy sight unseen on distressed properties. Homes in foreclosure make prime candidates. Some also buy properties wholesale. They’ll gamble on most of the properties being in reasonable condition. Further, some investors will buy sight unseen when trying to secure properties in very competitive areas.
What Are the Risks?
The main risk you’ll face is that the property has hidden issues. Photos and descriptions can only show you so much. Some sellers may even hide issues with their photos. Such problems can range from mould and damp damage to serious issues, like structural concerns. Every problem adds more money onto the amount you pay for the property.
You may also find the property is in a bad neighbourhood. Again, photos may not show the area surrounding the property. You can mitigate this risk with some research. Check the address to find out about similar properties in the area. There are also several websites that can provide crime statistics and other important data.
Can I Tackle the Risk?
Yes, you can. Beyond your initial research, there are several things you can do to lower the risks you face when buying sight unseen.
For one, don’t rely on the information the selling agent provides. Use the services of buying agents in the Eastern Suburbs, North Shore or Inner West to get another view on the property. You can also take advantage of the contract’s cooling-off period. Send an independent building inspector to check the property as soon as you can. You may find issues before the cooling-off period ends. This could allow you to cancel the contract without any penalties.
You can also send somebody to check the area surrounding the property. That person will look for external factors that you need to consider. These include noise pollution and the property’s closeness to things like sewerage plants and power stations.
These actions may cost you some money upfront. However, they could save you thousands of dollars that you would have wasted on an unsuitable property.