HUD homes no bargain for low-income Austin families. (United States Department of Housing and Urban Development)

HUD homes no bargain for low-income Austin families

AUSTIN -- In a "bidding frenzy" of unprecedented proportions, would-be HUD home buyers are not only paying substantially above-market prices for some houses but are having to take them "as-is" with no inspections or appraisals, an Austin Business Journal investigation revealed.

According to some area real estate professionals:

* The lack of inspections could leave new homeowners with unsound, unsafe houses to which thousands of dollars in repairs must be made.

* The lack of appraisals could take advantage of low-income families, the very families the U.S. Department of Housing and Urban Development (HUD) is supposed to help with its affordable-home programs.

* Neighboring homeowners may suddenly have trouble selling because the artificially inflated price on a HUD home has sent the appraisal on their own homes beyond what the market will bear.

These problems stem from procedures being used by HUD, a …