House For Sale! Just $5! Buy Now!

That’s right. For just a single one of the notes pictured at right, you could be the owner of a house. The catch? You’ll have to move it or do one heck of a renovation, perhaps both. So it’s not the bargain it seems. At least not entirely. If it’s priced extremely low, there’s probably a good reason. Or several.

With real estate prices at record levels throughout much of the country, one would like to think there are still some home bargains out there. Well there are. You could get yourself a three-bedroom Kansas City, Mo., bungalow for a mere $22,000? Or a two-story Victorian in Jonesville, N.C., with river views, for just $19,000? Better yet, maybe you’d be interested in a traditional New England farmhouse for $1.

Yes, we’re serious. And it’s not even a scam… although there are strings attached. Many of them. To be sure, it’s going to take more than looking in the classifieds or checking the real estate listings online to get a rock-bottom deal. But fabulous finds are out there. Below, we’ll provide some insight that will hopefully make your hunting happier.

A PIECE OF HISTORY
Every so often, the Town of Norfolk, Mass., sells historic homes for $1 each. The catch is that anyone interested in buying the homes must be willing to move them elsewhere. In most cases, owners want to build a new house on the lots and will demolish the existing homes unless they can get someone to relocate them. Local laws prevent them from doing so immediately.

“In Norfolk, we have what’s called a ‘demolition delay bylaw,’” says Bill Domineau, chairman of Norfolk’s historical commission. “If a home is determined to have some historic value, we can require the owners to hold off on destroying it for at least six months. During that period, town and historic commission officials try to interest someone in moving the home to a new lot or, at the very least, dismantling historic details — from crown moldings to pine floor boards — for sale or use in other homes.”

Most sellers in this odd situation offer the homes for $1, since that gets them out of paying for the demolition. Prospective home buyers or investors also get a heck of a deal in the process, so it works for all involved parties in theory — including historic home aficionados like Domineau. He is always happy to see any part of an old home saved from the wrecking ball, in what he calls a win-win-win scenario.

DIGGING UP THE HIDDEN GEMS
HistoricProperties.com is a site with about 750 residential homes and commercial buildings listed for sale throughout the United States — all of which are at least 50 years old. Listings include many $1 homes and others that actually are free for the taking. Sellers pay to be listed on the site, but Sharon Hinson and Marjorie Ellena, the site’s founders, offer free listings to historic preservation groups, non-profits and governmental agencies.

“Some homes need to be moved because local authorities are expanding public projects, such as highways, in the areas the homes are located,” Hinson said.

These real estate deals are usually advertised locally as well. For instance, in August of last year, the Houston Airport System put an entire neighborhood of homes up for sale at $1 each. The airport had purchased them from their owners in preparation for an expansion project, and will sell them for $1 each, provided buyers move the structures off the land. Homes also come up for sale at these prices when redevelopment groups begin improving urban areas that have been neglected.

“When these groups offer houses for sale, they’re often not in horrendous shape,” says Hinson. “The organization simply offers the houses at great prices as an incentive to bring in new owners.”

Many other homes are what are known as “project homes.” Often listed at prices of $1,000 to $35,000, these structures usually need extensive renovation. Buyers can — and should — make their purchase of the home contingent upon the findings of an independent home inspection. In other words, if you want to buy a home “as-is,” go ahead and do that. But it’s still important to understand the scope and extent of the problems you are acquiring.

JUST A FEW EXTRA DOLLARS?
In most cases, bargain homes can be obtained for a song, but will require serious cash infusions after the fact. You can still end up with a good deal through savvy shopping and the help of an experienced real estate agent who knows what to look for and what questions to ask. Some questions to consider if you are thinking about traveling this route:

• How much work are you willing to put in? Renovating a fixer-upper can be a huge job. If you don’t have the time or skill to do the work, spiffing up a house gets very pricey.
• Does the home have environmental problems? Examples include asbestos or lead paint, which can be far costlier to remove than you think.
• Does the home have valuable historic details? Some older homes are blessed with elements such as glass doorknobs, built-in cabinetry, or other rare amenities. Many such items would be expensive to build (or impossible to find) new, making the bargain home worth its weight in gold, even after you pay for its extensive rehabilitation.
• Is a vacant lot immediately available in your price range? It’s not going to matter if you can get a home for $1 if you can’t put it someplace else. Prime lots in some parts of the country might be as expensive as an entire home. Think this true before you call on your friend, Mr. George Washington.
• How easy is the house to move? Depending on your area of the country, moving a basic home can cost anywhere from $10,000 to $25,000, according to a vice president and part owner of Northwest Structural Movers. Taller homes cost more, as you may have to arrange for utility companies to move power lines and traffic lights so the house and flat-bed moving truck carrying it can fit down the roads.
• Is it a brick house? If so, forget moving it. It won’t survive the process.

So before you plunk down a couple of dollars on the residence of your dreams, be sure to take these things into consideration. While it could still be a bargain over what you’ll usually find in most red-hot Florida real estate markets, your little renovation effort is likely to cost you a lot more than you initially think. Fortunately, you can qualify for low-interest Florida home loans and finance it, with rates still at historic lows. Enjoy!