Everyone is well aware of the downturn in the economy for the last few years and some homeowners are more aware than others. In 2010, foreclosures have become more prevalent than at any time in recent history and of course, some real estate investors will take advantage of this situation. While this is an unfortunate situation in which to buy up property, the hard truth is that it has to be sold and someone has to buy it.
The good news for those who have the capital to buy right now, is that the price of these homes is most likely going to be well below the normal market value. In fact, banks are having trouble getting rid of many of their foreclosed properties. Money is tight for most potential home buyers and even investors are becoming more and more cautious. Consequently, banks are anxious to get rid of these properties as quickly as possible. By the same token, homeowners who are either selling their homes themselves or through a realtor are anxious to sell and get out from under their mortgages causing the listing price, in many situations to be more than flexible.
Homes that are being purchased now at auctions are not going to be “flipped.” Obviously, in this economy, investing more money in a remodel and trying to sell the home now would not be a good idea. These homes, however, can be used for rental property, until the market improves and they can be sold at a profit or as a source of continuing income as rentals. Renting out homes today, shouldn’t be a problem in most areas since many couples cannot buy at this time, or are simply afraid to commit until things improve.
Of course the main concern before buying is always location. Where the property is located in respect to industry, traffic, and other features is most important in its future worth. The overall condition of the property is another factor that needs to be considered since it will need to pay for itself, either through renting, or eventually selling, and you do need to take future costs into account.
No one wants to intentionally take advantage of some other person’s misfortune, but the truth is that if you have the funds to buy property now, and the homes have the potential of making you some monthly income, this is probably a good time to do it. Hopefully in the next few years, you should see a profit from your investment when it comes time to sell.