Real Estate Investment Properties: Three Ways to Find Properties at Bargain Prices
Have you ever wondered why some people always seem to buy property at deeply discounted prices?
This article will explore three general areas you may want to consider looking into for sale real estate investment properties and explain how you can take advantage of them.
1. Fiscal Executions
It is not uncommon for wealthy people to leave large estates for their children, but not realizing that sometimes the property tax levied on the property can be huge and the children end up having to sell the property. Another situation arises when the existing occupants of the property are unable to pay the property tax and a tax lien is then placed on the property. Sometimes the tax authority orders the sale of the property to collect money owed to it.
Tax liens are attached to the land, which means that when you buy the property, you buy it with the tax lien attached. So you’ll want to do your math and explore the potential demand for property in the area before you dive in and buy the property. A common strategy is buy, split, and build, where you buy a piece of land and then divide it up and build multiple properties on it and then sell it.
2. Foreclosures/Bank Auctions
Foreclosures and bank auctions usually go together and occur when a person is unable to pay their mortgage. Therefore, the bank wants to foreclose on the property and get the proceeds of the sale to pay the outstanding amount of the loan. As in most negotiation situations, the more desperate the bank is to sell the property, the better your chances of buying a property at a greatly reduced price.
You may want to bring a home inspector and property contractor to help you inspect the property before you buy it. Avoid properties with potential wiring, plumbing, and sewer problems unless you intend to spend a lot of money rebuilding the property from scratch. The property inspection is a presumptive part of any real estate purchase contract, so you should inspect the property as the law assumes that any buyer would do so even if the property is auctioned.
3. Fix broken tops
Some people are fed up with their houses because there are leaks and the house looks in general disrepair. If they are really upset with your property, there is a chance that you can negotiate a lower price for the property because there are a lot of renovations to be done. The advice for this is to take a contractor and/or architect with you to learn all you can about how much it would cost to fix the problem on the property and resell it. There are many people today who are looking for real estate to buy, rebuild and then resell, and you can make money with this real estate investment strategy.
So, in other words, you’ll be looking for a run-down property that you can fix with minimal hassle and cost. These properties can also benefit from economies of scale. By this I mean once you spend some time looking around an area and find that most properties have a similar problem that you can solve, why not buy more than one property and redevelop multiple units in the same area at the same time? and duplicate your efforts? and reduce your effective cost of construction.
In conclusion, always take your time to explore and examine every real estate deal or real estate investment that catches your eye and you can be much richer and get a property at a cheaper price in the market. Always remember that in terms of bargaining power, try not to appear too interested and let the most desperate seller cut his own price. Take some action today towards your investment dreams.
Copyright © 2006 Joel Teo. All rights reserved. (You may republish this article in its entirety with the following author information with live links only.)