The collapse of the housing market and all the foreclosures that it created caused the Great Recession of 2008. Also the recession itself has created a lot more foreclosures. Many people think that buying one of these homes will result in great savings. That is not always true as we will talk about here.
CNN ran an article saying foreclosures are cheap. They stated that you could save 39% on the price of a home by buying one of these many foreclosed homes and in Dayton Ohio they stated you could save as much as 57% on the homes prices. That is a little unfair since they were comparing them to homes that were not foreclosed on. They were also comparing them to homes of different sizes and amenities. They just took the medium price of homes and compared it to the medium price of foreclosures. That is like comparing apples and oranges. If you want to know what your real discount is on a foreclosed home have your realtor help you with a market analysis. Look at the foreclosed home and see what it needs to make it comparable to the homes that have not been foreclosed on in that neighborhood. Add the amount of the repairs to the price of the home and then see what your real savings is if any. You may still find a discount but not one as large as CNN reported.
There is a reason these homes are cheap. The people that occupied these homes were in financial distress and did not use money they did not have to upkeep these homes. Many of them had need for new roofs, appliances, windows and on and on. Instead of using money to do this upkeep they just used what they had for everyday essentials like food.