Posts (RSS)Make Money from Foreclosure Listings
If you are an investor looking for opportunities in the real estate sector or a prospective homeowner looking for a more affordable property to buy, now is the time to buy. The low home prices due to large numbers of foreclosure listings will enable you to earn a profit even after spending for repairs.
Rick Sharga, an executive of foreclosure tracking firm RealtyTrac, said investors can make money from the rising numbers of foreclosure listings if they do their research and if they have the finances to wait for some more years before selling. He advises against investing through flipping because he expects the market to continue to be flooded with home foreclosure listings.
Sharga said that despite nationwide foreclosure prevention initiatives, repossessed homes would continue to be added to foreclosure listings because of continued job losses and business closures. He said the February total of 291,000 units added to foreclosure listings indicates that foreclosure auctions will not end soon.
Hence investors taking advantage of low prices should have the financial resources to wait for a couple of years and should have backups in case they are laid off. Investors should have adequate money for the monthly mortgage payments in case they can not find renters. They should also make sure that the property has no outstanding tax lien or any other lien and that what they are buying is a first mortgage and not a second mortgage.
Additionally, there are other important things that you need to consider before investing in properties from foreclosure listings.
First, consult with a reputable real estate agent about foreclosure listings, prices, home sales and resale prices in the neighborhood and in nearby communities. Ask how long rental properties and resale properties are marketed before they are taken. Next, hire a general contractor to inspect the property and estimate the cost of repairs. Finally, calculate your total outlay by adding up your down payment, repair costs, marketing costs and monthly payments for the expected period there are no renters.
While buying properties from foreclosure listings might not be very comfortable because of the thought of families being evicted from foreclosed homes, investing in distressed properties helps rejuvenate the housing sector and ultimately contributes to economic recovery.