Should I Buy an Abandoned NJ Home

Purchasing an abandoned home in New Jersey is a fantastic way to grow equity by securing a cheap property—but it can be risky. Neglected or empty homes often come with physical defects and legal and financial entanglements. Back taxes, municipal liens, and structural issues can drain your funds. If you are debating purchasing an abandoned property, it is important to think through the decision well in advance of signing on the dotted line. Veitengruber Law is an experienced real estate attorney in New Jersey. We have worked with many homebuyers to successfully purchase abandoned NJ properties.

Here are some things to consider:

You Need Cash

While the sales price of an abandoned property may be low, the cost of renovations can be astronomical. Most abandoned home renovations cost between $50,000 and $200,000. When you are determining if you can afford an abandoned property, you need to consider a few things:

1. Sweat Equity: You can really bring down the cost of your project with some hard work and skill. If you have the skills and physical ability to do many of the repairs and renovations yourself, the work needed to get the home up and running can become much more affordable. Be realistic about the tasks you can tackle versus those you should hire professionals to do. Trying to cut corners to save money now can result in damage or bigger expenses down the line.

2. Financing Troubles: Traditional mortgages will require a home to be livable. Because most abandoned properties are uninhabited and in disrepair, it can be difficult to secure traditional financing for your purchase. Instead, you will need to consider other funding options, such as personal loans, specialized construction loans, or cash savings. These funds need to cover not only the purchase of the property but also the renovations that will follow.

You Need Experts

Purchasing an abandoned property comes with unique challenges. It is crucial to have a team of experts on your side to ensure that your best interests are guarded throughout the purchasing process. Some of the experts you need include:

1. Real Estate Agent

A real estate agent can help you find abandoned properties for sale by searching through vacant property lists and municipal tax sales. Experienced real estate agents have a keen knowledge of the properties and real estate practices in the area. They may be able to give you an insider’s scoop on a property. Real estate agents are also well-connected to other real estate professionals in the area who can assist you in achieving your goals.

2. Home Inspector: Most abandoned homes are sold “as-is,” which means the home is being sold in its current condition, and the seller or owner will not make any improvements. When you agree to purchase the property, you agree to accept the condition of the property. You need to work with an experienced home inspector to get an idea of the repairs needed. While entry to the home for an inspection is sometimes not possible with abandoned homes or homes sold at auction, you can typically still get an inspector to take a look at the areas of the property they can access.

3. Real Estate Attorney

A real estate attorney can help you do crucial research on the legal and financial entanglements of an abandoned property. They can search the local tax assessor’s office records for the deed and tax history of an abandoned home. This research will help you identify who owns the property and the extent of any debt associated with the property. An attorney can also perform a thorough title search on the property to ensure you are not inheriting a mountain of debt.

If you are thinking about purchasing an abandoned property, Veitengruber Law is ready to be part of your team!