The foreclosure market is a great place to find affordable properties for investment. About five million homes have gone through foreclosure in the United States. But what was initially a raging torrent has now changed to a slow stream. This is because large investors had snapped up properties in bulk. According to the National Association of Realtors, the number of foreclosures available for purchase in 2014 reduced by 24% from 2013. Large investors have slowed their purchases and this has opened up the market for small investors.
Industry expert Jeff Adams states that private investors will not face much competition in the foreclosure market. So if you have the time and money, this is a good time to step into the foreclosure market. However, you don’t want cheap property. You want good property that will give you substantial returns. In that case, you should know these few smart moves that will dramatically improve the success rate of your real estate investments.
Tip # 1 – Always Check The Foreclosed Home Before You Make A Quote.
Unlike other properties, foreclosed properties are usually owned by the lender and they usually don’t have time to maintain their inventory. Sometimes annoyed homeowners yank out appliances and essentials before they get evicted. As a result, you should always check the property before you quote a rate or bid on the property.
Tip # 2 – Estimate the Cost Required To Make the Home Livable
Foreclosed homes are usually empty. As a result, the home has not been maintained. You will have to clean the house and carry out any essential repairs that may be required. Make sure you hire a house inspector and a contractor to assess the condition of the home. Be particularly careful if you see recent repairs. No one will vacate a home after doing expensive repairs. Recent repairs usually suggest maintenance deficiencies in several areas of the property. After you have assessed these repairs, make sure you budget it into your property quote.
Tip # 3 – Assess the Neighborhood
Sometimes, the home may have a renting tenant in residence. In this case, you will inherit the house in the condition it is in, along with the renting tenant as you cannot evict them. Apart from renters, you should also check the condition of the neighborhood. In some areas, all the homes may be foreclosed upon and empty. These areas may be beautiful and the houses may be lovely but you cannot get a high rental rate. Before purchase, always drive through an area and its surroundings to assess just how the neighborhoods are.
Foreclosure Investing is not simple. As the market changes daily, industry experts like Jeff Adams, the #1 real estate trainer, recommend you keep yourself updated with current market changes. Join an accounting course, learn the basics of real estate investing, and talk to industry professionals to ensure that you know just how the foreclosure market is evolving. With the right help, you should have no problems in making your real estate investing career a success.
