Buyers Grabbing Lower-Priced Foreclosure Homes in Pasadena
A family of four has recently bought a craftsman house in Pasadena for $330,000, a price unthinkable for such as beautiful house two years ago when large numbers of foreclosure homes were unheard of.
The family has been planning to move to less-expensive San Fernando Valley communities so they can buy their first home, but the sudden wave of foreclosure homes in Pasadena has put home affordability to the reach of more people that the family was able to buy their first home in Pasadena.
Foreclosure homes represent painful struggles and broken dreams to the former owners of the homes, but they now represent the realization of home ownership to families who previously could not afford homes in the areas that they like.
The $330,000 home purchased by this family of four was purchased by the previous homeowners for $549,000 in 2006. The bank decided to accept the lesser price and the loss to clear its bank owned foreclosure homes.
In the past several months in Pasadena, an analysis of ten of the houses sold showed that all the houses were sold below $350,000 and all of them were originally purchased at prices above $500,000.
In April this year, the median home sales price in the city was $462,500, a big drop from the median price of $620,000 in April 2008.
Real estate agents in Pasadena said that the best sales deals are being done in the 91103 zip code area because of the large number of foreclosure homes in the area, but strong home selling and buying has spread citywide because of the rising number of foreclosed properties in other areas of the city.
For some prospective home buyers, home buying in Pasadena has become a fierce competition always won by those who have cash.
One information technology administrator in Pasadena said he has made offers for many foreclosure homes around the city, but all his offers were beat by buyers who had cash even if his bids were higher.
Many first time buyers are facing difficulties because sellers were considering only offers with at least ten percent down payments. Even with the first-time buyer tax credit assistance and the lower mortgage rates, many lower-income prospective buyers could only afford a down payment of 3.5 percent, the minimum down payment set by FHA for its loans.
Nevertheless, as the number of foreclosure homes continues to increase in Pasadena, the city is still a home buyer’s market.
