Avoiding A Bad Investment Is Easier Than You Might Think

Human nature being what it is, none of us can get serious about the idea of buying a house without experiencing at least a few small twinges of worry. What we fear, of course, is making a mistake. And the mistake we tend to fear most is buying a "lemon" - a house that doesn't simply fail to satisfy our hopes but turns out to have so many flaws that it's a disastrously bad investment.

The good news is that the danger of getting stuck with a lemon of a house is one of the most easily avoided dangers in the whole universe of personal finance. Prospective homebuyers are protected in many ways, and they can further strengthen their defenses by taking a few simple, commonsensical precautionary steps.

The first of your protections is the fact that in many places sellers are required by law to make problems known to potential buyers - and are liable under the law if they fail to make adequate disclosure.

For obvious reasons, however, most of us prefer to steer clear of legal entanglements even when the law is on our side. In the housing market we do this by identifying problems before closing the deal. And identifying problems isn't necessarily all that difficult. Even a person who's not an electrician or plumber or construction expert often can identify areas of potential concern simply by being alert when visiting a house that's on the market.

It's a simple matter, for example, to turn on faucets and showers to test water pressure. In a bathroom it's a simple matter to turn on the hot water both at the sink and in the shower at the same time and then flush the toilet and watch for drastic drops in pressure or temperature. This is highly likely to produce evidence of whatever problems are lurking in the plumbing system.

Most homes should provides at least 200 amps of electrical power, and it's usually possible to confirm this simply by checking the numbers on the circuit-breaker panel. Check, too, for extra-heavy 220 -volt outlets where they're needed for a washer, dryer and other heavy appliances - and for the grounded three-prong outlets needed for computers and power tools.

A house that's been standing for years but still has straight walls and ceilings and remains free of cracks and the stains that indicate leaks is likely to be structurally sound.

Are the basement walls damp - or even wet? Have termites left their calling cards - tubes or tunnels where the walls touch the ground, or wood debris around baseboards?

Wherever you see such things, things that you wonder about because you don't understand them or wouldn't expect to find them in a completely sound structure, you can be confident that it's time for further examination. Keep an open mind about what that further examination might lead to, however. Things that can look like big trouble to the amateur eye sometimes turn out to be quite trivial when an expert checks them out.

The word "expert" is a crucially important one to remember. Ultimately, before closing on the house of your choice, you should have it inspected by a professional - one who has solid credentials and a solid reputation and whose work is guaranteed. Your purchase should be contingent on the results of the inspection. Your realtor can help you make all this happen, thereby reducing your risk to the vanishing point.

About The Author

W. Troy Swezey is the author of "AVOIDING A BAD INVESTMENT IS EASIER THAN YOU MIGHT THINK." As a Realtor at Century 21 Paul & Associates, he has helped many individuals with their real estate needs. Visit his web site to download his free e-book, "REAL ESTATE SECRETS EXPOSED." http://www.TroyIsMyRealtor.com or mail to: TroyC21@usa.net

There is something emotionally charged about the buying and selling of New York high-end real estate. How else to explain the juggernaut of reality TV shows about high-end brokers?

After 30 years of marriage, Sharon and Michael Newman decided it was finally time to move from the Catskills to New York City.

On blocks near Kissena Park streets are quiet, houses are small, and the electricity that charges the atmosphere in downtown Flushing is nowhere to be found.

A five-story, seven-bedroom house in Brooklyn Heights has sweeping views of New York Harbor and the Manhattan skyline.

Demand is so intense that there are waiting lists in some buildings, and a few landlords report that eager renters are even bidding up rents.

Sales at the very high end of the market barely missed a beat in the recession. But that prosperity hasn’t yet trickled down.

A Flatiron condo, a Midtown South co-op and a Brooklyn Heights carriage house.

A four-bedroom ranch in Montclair, N.J., and a four-bedroom colonial Cape in Babylon, N.Y.

For a century, Roosevelt Island housed a grim penitentiary. It was demolished in the 1930s.

More borrowers are opting for fixed-rate loans with terms other than the standard 30 or 15 years, especially when it comes to refinancings.

Two more glass skyscrapers are added to a group of towers on the waterfront of Long Island City.

Insurance coverage for a co-op unit; when a tenant is ‘blacklisted’; a co-op is smaller than estimated.

The market for $500,000-to-$600,000 houses in Westchester has become especially active.

A shaky real estate market means more sellers are providing buyer concessions, from gift cards to help with paying property taxes.

Houses of worship are adaptable to residential and other uses as congregations dwindle.

The settlement reached last week over questionable mortgage practices by major American banks hardly cracks the iceberg that is the foreclosure mess.

Under the settlement, nearly two million Americans could benefit from mortgage relief from the nation’s biggest banks.

A cold war-era satellite relay station is for sale in California after a Silicon Valley mogul gave up on plans to turn it into a weekend home.

How can I make my front porch more appealing to buyers?

Court hearings meant to protect New York homeowners from foreclosure are hopelessly slowed by endless paperwork and requests for additional information.

The Bay Area and Silicon Valley expect the windfall from the Facebook stock offering to make their in-demand region even hotter.

The house, designed by the architect Eric Fisher, looms over the street like a big industrial arm.

A town house in Dallas, a midcentury modern in Rhode Island and a Tudor in Denver.

Prices in some parts of the country are still off by as much as 25 percent from their 2007 peak.

Trinity Church is the largest landlord in Hudson Square and is part of the effort to rezone the area to residential from manufacturing.

Rising oil prices and a boom in shale exploration are leading companies to add office space in the Houston area, most notably Exxon Mobil.

Ms. de França is the president and chief executive of Douglas Elliman Development Marketing, which focuses on new residential developments.

Meet the real estate broker’s interns: an ambitious group willing to do anything, earn nothing and wake up early on a Sunday to fluff the couch cushions at open houses.

A Flatiron condo, a Midtown South co-op and a Brooklyn Heights carriage house.

A four-bedroom ranch in Montclair, N.J., and a four-bedroom colonial Cape in Babylon, N.Y.

Homes in Dallas, Rhode Island and Denver.

Compare the cost of renting and buying equivalent homes.

For recently divorced men, a new breed of decorators offers help navigating a strange new world.

Plants that light up the winter garden can be found at Broken Arrow Nursery in Connecticut, which has long been a favorite of gardening geeks.

A sister in need drew the painter Beverly McIver back home to North Carolina, unaware that a new beginning was in store for both of them.

A jewelry designer finds striking new objects for storage.

Timothy Sakamoto and Jochen Repolust are part of the small but growing niche making mobile apps focused on specific works of architecture.

To promote an auction of 20th- and 21st-century design, the interior designer Stephen Sills has created a preview exhibition in an apartment at the Apthorp.

Fishs Eddy now sells plates acquired from the archives of the now-defunct Syracuse China Corporation, many more than 100 years old.

The designer Russell Greenberg creates custom baby rattles with ends shaped like profiles of mom and dad.