It's a tragedy that many people are forfeiting their homes during this sub-prime real estate crisis. It was recently reported that foreclosures account for 50% of the homes currently being sold in the US. Even though many people are losing their homes, there are many others who can finally afford a home or are now investing into real estate and taking advantage of these discounted prices.
If you look at any successful real estate investor, they have accumulated much of their wealth by buying when there was a downturn in the market. Donald Trump is a good example of someone who was buying up real estate real when everyone else was selling as illustrated in the quote. "When I first started out in Manhattan, everyone was saying what a terrible market it was, and if I'd listened to them, I would not be where I am today. There are always opportunities." Donald Trump.
Many of the top real estate investors, including Mr. Trump, now feel that this is currently a good time to invest in real estate by purchasing pre-foreclosed or foreclosed properties.
The main reason is unlike foreclosures, a pre-foreclosure is made privately between the owner and buyer and therefore avoids the bank auction foreclosure process. This provides many advantages to the buyer including more time to inspect the inside of the house and a better chance to establish a mortgage with a bank.
There are macro (local community, etc.) and micro aspects to take into consideration when looking for a pre-foreclosed home. Here are the some of the macro aspects:
- Try to find out how many other homes in the neighborhood are in pre-foreclosure or foreclosure. It's best if the home you're interested in is one of the only houses under financial strain. In order for properties to appreciate the number of foreclosures has to be minimal.
- Ask around to find out whether the rent rates in the neighborhood are going up or down. Buying in a neighborhood where demand for rental units is on the increase is important.
- What is the local economy like at the town, local city and/or county level? Is the unemployment rate increasing or decreasing?
- Check with the local government to see of any upcoming infrastructure projects that will be taking place within 2-3 years. Projects such as new shopping malls, highways, train/subways lines, building permits for new businesses being established, new parks near the property, etc.
- Consider the age of the majority of the population within the community. If the majority of the local population is seniors that own homes, that could translate into an excess of future housing as they move into elderly care facilities.
If these macro aspects all work out in your favor, and if the inspection of the house goes well, then chances are it's a great opportunity for you to buy that pre-foreclosed home. When it comes to making a mint in real estate it's all about timing and location.
If you look at any successful real estate investor, they have accumulated much of their wealth by buying when there was a downturn in the market. Donald Trump is a good example of someone who was buying up real estate real when everyone else was selling as illustrated in the quote. "When I first started out in Manhattan, everyone was saying what a terrible market it was, and if I'd listened to them, I would not be where I am today. There are always opportunities." Donald Trump.
Many of the top real estate investors, including Mr. Trump, now feel that this is currently a good time to invest in real estate by purchasing pre-foreclosed or foreclosed properties.
The main reason is unlike foreclosures, a pre-foreclosure is made privately between the owner and buyer and therefore avoids the bank auction foreclosure process. This provides many advantages to the buyer including more time to inspect the inside of the house and a better chance to establish a mortgage with a bank.
There are macro (local community, etc.) and micro aspects to take into consideration when looking for a pre-foreclosed home. Here are the some of the macro aspects:
- Try to find out how many other homes in the neighborhood are in pre-foreclosure or foreclosure. It's best if the home you're interested in is one of the only houses under financial strain. In order for properties to appreciate the number of foreclosures has to be minimal.
- Ask around to find out whether the rent rates in the neighborhood are going up or down. Buying in a neighborhood where demand for rental units is on the increase is important.
- What is the local economy like at the town, local city and/or county level? Is the unemployment rate increasing or decreasing?
- Check with the local government to see of any upcoming infrastructure projects that will be taking place within 2-3 years. Projects such as new shopping malls, highways, train/subways lines, building permits for new businesses being established, new parks near the property, etc.
- Consider the age of the majority of the population within the community. If the majority of the local population is seniors that own homes, that could translate into an excess of future housing as they move into elderly care facilities.
If these macro aspects all work out in your favor, and if the inspection of the house goes well, then chances are it's a great opportunity for you to buy that pre-foreclosed home. When it comes to making a mint in real estate it's all about timing and location.
About the Author:
To locate the top pre-foreclosure sites the Internet has to offer go to government auctions review or go straight to pre-foreclosures
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