Everybody loves a good deal, especially when it comes to real estate. Whether you’re buying a home for your family or looking for a good investment opportunity, finding a quality home for an affordable price is every buyer’s dream. When searching for a home, you’ll want to keep an eye out for properties that offer good value – and in some cases that might mean thinking outside the box. While a move-in-ready home might be ideal for some buyers, there can be some more affordable options available.
One option to consider are distressed properties. These properties are those being sold when the current owner is under financial burden: including properties that have been foreclosed or are being sold as a short sale. In both of these cases, a distressed property may be available for purchase at a lower price than they would otherwise be worth on the open market. If you’re a buyer interested in purchasing a property with the intention of flipping, these properties should definitely be on your radar.
It’s important to remember that not all distressed properties are created equally, and each case comes with its own unique risks. While the owners have fallen on financial hard times, that doesn’t always mean the homes have been neglected or fallen into disrepair. When interested in a distressed property, it’s a good idea to seek out as much information as you can before making a bid or offer. If possible, hiring an inspector or contractor is always a good move to make. If not possible, look for listing photos or consider touring the property and taking photos and videos that you can use to discuss with a professional. The more information you have regarding the general condition of a property the better for being about to assess the home’s worthiness of being an investment property.
Look for a distressed property that needs more in terms of cosmetic work, while purposely avoiding those which need major structural repairs or significant remodeling. Extensive costs for repairs and remodels could turn a ‘bargain’ property into an expensive drain of both time and money. Use available context clues to try and make educated guesses regarding the property’s condition: if you don’t have photos, drive by the property and see for yourself or better yet, tour the property in person. A building showing signs of serious disrepair outside likely needs a lot of work inside too.
When it comes to purchasing a property, the search for a good deal is always going to be on your mind. When checking out distressed properties, you’ll want to make sure to protect your investment by gathering as much information as possible prior to making any financial commitment. Be aware of your personal limitations: some projects may be too large for even a motivated and experienced DIY handyman. Hiring a contractor will only add to the cost of a flipping project. Invest smart and good luck!
