Many investors take a lot of interest in purchasing foreclosure homes from their owners or banks. They want to acquire these properties for very low prices and then let out these homes out to tenants. In the process, these investors expect to earn a lucrative profit from the venture. Unfortunately, real estate experts say most of them do not have adequate experience in this sector of the property market. They often end up making all the wrong decisions by overlooking many critical factors.
Travis Cadman – What should investors consider when buying foreclosed residential homes?
Travis Cadman is a popular real estate developer from Phoenix, Arizona, with more than 25 years of experience under his belt. He specializes in the purchase, sale, and transfer of a wide range of real estate projects. These include acquiring foreclosure homes, developing commercial properties, townhomes, and promoting land syndication. Today, he operates a number of successful real estate development firms with his brother, Ron. These businesses are Maui Land Syndication, Rustler Holdings, Davenport Project, Quadra Townhomes, Arizona Investar, Edmonton Apartment Syndication, and CBI Group.
According to Travis Cadman, investors can earn lucrative returns by investing in residential foreclosure homes, which they eventually let out to tenants. To do so, they need to understand acquiring these properties is not the same as purchasing brand-new homes in the market. The investors need to take into account several factors before they finalize the real estate transaction. Above all, they need to keep in mind the following three tips:
- Find the right foreclosure home
Investors can find foreclosure homes for sales from a variety of sources, including newspaper advertisements and online property sites. Once the investors come across a property that attracts their attention, they should browse through its public records. The objective is to find outstanding mortgages and taxes which the owner of the home is yet paid. Such lien can significantly reduce the price the owners ask for the property.
- Conduct a thorough survey of the neighborhood
Most investors assume that almost all foreclosure homes are in run-down neighborhoods. Unfortunately, they are wrong. The investors may even find these properties even in affluent localities if they know where to look for them. This is why the investors should conduct a survey of neighborhoods of foreclosure homes that attract their attention. These areas should have reasonably good shopping centers, public transport facilities, schools, and other similar amenities.
- Examine the overall condition of the residential homes
Investors need to understand that owners who receive a foreclosure notice from the banks stop maintaining their homes. This is why many investors find most foreclosure homes to be in a derelict condition. Investors who have an interest in buying a particular foreclosure home should first review the property and determine its proper market value. They may hire the services of qualified structural engineers for this purpose. Only then should investors take a decision
In the opinion of Travis Cadman, investors can make a fortune purchasing foreclosure homes and letting them out to tenants. To do so, the investors need to look for the properties which interest them. They need to ensure these homes are in localities with adequate amenities to attract tenants. Moreover, these investors need to assess the condition of the homes to determine whether they are worth buying.