Recently, the real estate market has been seen as a black hole. However, you will see that if you invest in the right type of property, you have the potential to earn very good profits with the added bonus of revitalizing neighborhoods. I am talking about short sales and foreclosures.
Why Should You Invest in Foreclosures?
When the borrowers have failed to pay for more than 90 days, lenders foreclose the property. The bank tries to recuperate the money lost by typically listing the properties for sale for the price that is owed to them and not the true value. Thus, properties may be found listed for $100,000, even though their real value is $250,000 or more. If you buy the property, you will in fact gain $150,000 in equity.
The biggest profits tend to come when you invest in luxury foreclosures. This may even allow you to receive a 50% to 70% discount. So, for instance, if the house is valued at $600,000, you may be able purchase it for $180,000. In case the residence isn’t in top condition, you can upgrade the necessities and bring it to standard so you can get almost the full value . For example, you have given $180,000 for the house, you can invest another $30,000 and sell it for $550,000, with a profit of $340,000 for just one home. An average worker will have to work 6 years to earn an income of $340,000!
Short Sales Investment
You may be wondering why it is good to spend money for a short sale instead of purchasing a foreclosure for a smaller sum of money. Short sales may sometimes be a better transaction than a foreclosure because you will talk to the homeowner himself instead of the bank. A homeowner will want to sell the residence fast. Thus, you will see that a short sale is a more relaxing deal.
If you are thinking about purchasing a property that is in great condition and you can get a really good price for it, it would be an ideal situation. Since the home already looks good, you won’t have to invest too much in it in order to bring it to an acceptable standard. So, your profit will be much higher. Short sales usually have the same price as the borrower owes, rather than their real market value. Thus, you can acquire a good property at a really low price.
Investing money in short sales and foreclosures can truly change your financial life. You will require a skilled eye, hard work, negotiation skills and also the capacity of determining if the property has the right price in order to make a good investment. If this is something you’re interested in and want to learn more, we are offering an infield training session. Click here to learn more or call 212-465-1008 ext. 405