What to be aware of with ‘bargain’ properties

Everyone loves a good bargain. Whether it's scoring a discount on a new fridge or finding a great deal on a vacation, saving money is always satisfying. But when it comes to buying a property, a bargain becomes especially appealing when you know you’re about to spend a significant amount of money. In today’s episode, I’m talking about what would potentially define a bargain property and what to be aware of. While you may get lucky in stumbling across a property that’s going for less, there’s always a chance it’s a bargain for a reason.To start with, I define a bargain property as one you can purchase for significantly less, or at least a fair bit less, than what you consider to be its market value. You might want to determine market value through doing a comparable sales analysis and benchmarking that property against similar other recent properties that have sold. Alternatively, you might determine its worth against your own personal values and consider it to be less than what you’d be prepared to pay for it. Whichever way you look at it, it’s important to consider the factors that might be contributing to a property’s bargain price. I run through the four main categories that you should keep in mind:Vendor motivation - when the seller is prepared to accept a lower offer due to their personal or circumstantial factors. This is less a reflection on the property and more on the vendor’s situation.Market timing - when external events create opportunities for buyers to purchase at a discount.Luck - you might just be in the right place at the right time where, for example, a previous buyer’s finance falls through and an auction passes in to you. Property characteristics - when there are inherent issues in a property such as a less desirable location, structural issues or a need for costly renovations.I also talk about off-market properties, and how even though many buyers assume vendors will be more willing to negotiate, it’s certainly not always the case. In fact, some sellers may even demand higher prices for selling off-market.Ultimately, it’s important to know your priorities. A property that aligns with your strategy should come first. From there, you can determine whether you’re willing to pay what the seller is asking, or continue your quest in finding the property that ticks all your boxes.LINKS:Check out my FREE checklist 100 Things To Look Out For At Property Inspections hereConnect with Amy:Website: www.thefirsthomeguidebook.com.auInstagram: @the.first.home.guidebook