Advantage to buying a HUD house?

Question

My brother in California is disabled, gets SS disability, and has a living trust with enough cash in it to outright buy him a modest house. The family thought of buying him a HUD house, paying cash, and we are wondering if there are tax or income advantages to buying a HUD house? Thanks!

Answer 1

Not really, but most are priced below current market values for the area's they are in.  But most need considerable repair, so make sure if you do buy one to have a whole house inspection before closing. That way if anything serious is wrong, you can back out of the deal.  It's possible the county and/or city may offer some discount rate on his taxes due to his disability, but you would need to contact them directly for precise information.  

Answer 2

The only advantage is that he may get the house at a discounted price.

I would strongly recommend you have a home inspection done.  A HUD home can be a real bargain or a real headache.