I like to buy investment property in Chicago to rehab and resell, and I’ve been doing it for years. My friend, Sam, who lives on the east coast, prefers investing in New Jersey real estate. And we’ve both noticed that when the market takes a dip, many of our fellow investors run for the hills. When it shoots up again, they come scrambling back in an effort to grab a few good deals. Sam and I laugh about this because, though real estate markets rise and fall, they rarely fluctuate so wildly to justify such emotionally-charged behavior. Sure, navigating the housing crisis ten years ago was a tough row to hoe, but we survived. If you want to survive—and even thrive—as an investor, all you have to do is know how to find real estate deals in any market—even an unpredictable one. Well, that, and have the best team of experts on your side.
How to Find Real Estate Deals in Any Market
Obviously, Sam and I know how to make a good real estate investment in any market, which is why we’ve both been able to hang in there this long. Some investors consider us lucky. But, we know how hard we’ve had to work to make flipping houses a good business over the years. It definitely helps that we both have a consistent way to find the best real estate deals. So, even if the housing market forecast for New Jersey turns grim or property taxes in Chicago spike, we keep our calm and carry on.
Whether you’re in Detroit or Atlanta, if you want to buy and renovate property as successfully as we do, and for as long as we have, you’ve really got to have the best lead generating system available. I’ve outlined some of the most popular strategies below for finding real estate deals and I’ve included what Sam and I consider to be the most effective. I predict that, after you check them out, you’ll clearly see how you can find investment deals that yield potentially good returns too anytime.
Homes in Foreclosure
Homeowners can experience financial distress and fall behind on their loan payments in any market. So, homes in any stage of foreclosure, from a notice of default to repossession by the bank, can make a good investment. If the homeowner is still in possession of the house, they may want to sell to get out of financial hot water quickly. If the bank takes the home, they often want to unload it fast and cheap, too. Depending on where the property is in the foreclosure process, you can find them listed on lender websites, in published legal notices, on lead lists, and with your local MLS.
But, buyer beware. Homes in foreclosure tend to be in rough shape and, sometimes, prohibitively expensive to repair. They can fall in-and-out of the foreclosure process, too, if the owner makes an appeal or gets current on the loan. If the bank takes the home, they may decide to do some of the rehab themselves—and price it at full market value. So, though these homes have the potential to make for a good investment, they also have the potential to cost you in time and money—more than they’re actually worth.
Homes can go to auction because of bankruptcy, divorce, death, back taxes, unpaid liens, and as a part of the foreclosure process. You’ll find that local government offices, like your county Sheriff’s Office as well as private firms and online companies, conduct them. Sometimes these homes are in move-in condition, but it’s more common that they’re in disrepair since the previous owners were likely financially distressed. And, they tend to be priced below market value to draw in as many bidders as possible, so finding a decent deal on a rehabber is possible.
However, you could end up needing a big chunk of change to buy an auctioned property. Large cash deposits are usually required and the full balance can be due the day after the sale. Depending on the auction, there may also be a Buyer’s Premium fee. There’s almost always a stiff penalty for not paying on time. And, in most cases, you won’t have time to perform an inspection or conduct due diligence. So, if the property is a money pit of repairs and unpaid taxes, it becomes your money pit.
You’ll also find that vacant, abandoned, and non-owner occupied homes are frequently in disrepair and could be purchased below market value if you can find the homeowner. In fact, looking for signs of deterioration—an unkempt lawn, boarded windows, even an overflowing mailbox—could lead you to a good deal if you have the time to drive or walk neighborhoods. And, approaching distressed homeowners and buying from them directly is usually easier than trying to win an auction or buy an REO.
The problem is that locating the owners of these homes can be just as time-consuming as searching for the properties themselves. Although you can look up tax records, check with the county courthouse, or pay an online service to help you, finding the homeowner won’t guarantee that they’ll want to sell. It also won’t guarantee that you’ll want to buy—especially if you have to handle an eviction for a tenant-occupied home or pay off any liens or other encumbrances.
Obviously, as popular as these lead generating strategies are, they’re hit or miss when it comes to consistently finding deals. The best real estate investor lead generation system I’ve ever used is one that helps me navigate even the most unpredictable markets by finding motivated sellers of distressed properties and bringing them to me. Sam uses it too. So, we never miss out on getting the best leads for our businesses—and you don’t have to either.
Never Miss Out on Finding the Best Leads
If you listen to the radio, like I do, you’ve probably heard one of the “We Buy Ugly Houses®” ads by HomeVestors®. It was over a decade ago when I first heard one. But, when I did, it changed how I thought about finding leads on real estate deals. After all, if I was hearing the ads, then distressed homeowners were too. So, I gave the HomeVestors® team a call to ask about their advertising campaign—which also includes television, billboards, and print—and how effective it was at drumming up leads. It turns out it’s so effective that over 95,000 houses have been bought by independently owned and operated HomeVestors® franchisees since 1996. So I signed right up. Shortly after, Sam did too. It didn’t matter that we were investing in different regional markets. We both got access to leads on local homeowners in distress who call HomeVestors because they need to sell fast. So, even when our respective markets turn unpredictable, we’ve got the best leads from the best, and only, real estate franchise.
Don’t take a hit-or-miss strategy for finding real estate deals. Call HomeVestors to become a part of the “We Buy Ugly Houses®” team today!
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