The downturn in the real estate current market has established an unexpected benefit for real estate investors: Short sales are booming and express no signs of slowing down.
Consider the statistics tracked by RealtyTrac Inc.: One out of every single 136 homes in the United States is contending with foreclosure..
When the home owner is in foreclosure and the bank sells the property for less than what is owed, this is when short sale takes place. The home is “short” in market value, and the bank was unable to sell it while in foreclosure.
For real estate investors, this connotes a golden opportunity. It is so fantastic how you may get investment properties for much cheaper than ever before. 10 years ago, short sale houses were rarer, and typically only homes in the worst condition were sold via short sale.
Today, that’s no longer the case. Now, even multi-million dollar homes in manicured neighborhoods to commercial properties sold for pennies on the dollar, which means any home is subject to short sale.
Banks Are Now Property Holding Companies
The foreclosure crisis has put banks in the precarious position of negotiating with would-be buyers for homes. A lot of times, a bank will negotiate a short sale with a buyer just to get the “bad” loan off its books and avoid the maintenance costs of maintaining a home in foreclosure.
Typically, real estate investors deal with the foreclosed homeowner, but any short sale offer must be approved by the bank. It used to be that real estate investors negotiated with homeowners for the best deals. But now, it’s more common for real estate investors to negotiate with banks for the best deals.
The House Short Sale Benefits To Investors
Short sales could be a bad news for defaulted homeowners and banks, they are nothing but good news for real estate investors. Today, homes are sold at rock bottom amounts, at prices never before seen in recent history. Entire neighborhoods and subdivisions have lost 25 percent, 50 percent and even more of their property values.
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