Today I went out looking for a new (for me) house. Most of the houses were overpriced given the market here. Almost all of the houses I looked at required pretty extensive work to make it ready to live in, but they were on the market for a price that was close to what they would be expected to sell for in move-in condition (around $70 square foot). Even the bank-owned property, which needed probably $15,000 worth of work to make it livable was on the market for $72,000. In top condition, the house would be worth around $79,000.
Mind you, I am looking for a house with about 1000 square feet. (For my European and Australian readers, this is about 100 square meters).
What I am finding out is that houses larger than 1000 sq. ft. are not selling for as much money per sq. ft. as the smaller houses.
Finally, I looked at a fixer-upper that is being offered for $49,000. That amounts to less than $50 per sq. ft. However, it will require probably about $10,000 in repairs. This doesn't seem like such a bad deal. On the other hand, I have not seen the results of any inspections, so there might be something wrong that could not be seen upon a visual inspection.
It certainly is not like the madness that is taking place on the coasts and many cities around the country.