The key to success in flipping houses is to find distressed properties. Distressed properties are generally priced under its market value, sometimes under foreclosure or in need of some work. Property owners are reluctant to call their house distressed so then it can be hard to find them. However with research you can find the gem you are looking for. Here are 4 ways to find distressed properties.
Abandoned or Vacant Homes
There are vacant homes in each and every city though they can be hard to spot. There are several reasons for the property to be vacant and each can present an opportunity for you.
- Out of town owners: The owners have moved to another town and left the property vacant rather than renting it out or trying to sell it. It simply may not be a priority for them.
- Bank owned property: These properties have been foreclosed on and many of these properties sit vacant, you can usually snag a good deal as the bank is largely interested in getting the balance owed to them on the property.
- Government properties: Like bank owned properties these are also a result of foreclosure and you can find them on government websites.
- Probate: After the death of a homeowner the property may sit vacant if the heirs aren’t local or there is no spouse. You can find properties in probate at the county registrar.
Owners Who Are Delinquent
Delinquencies can be for either taxes or mortgage payments.
- Mortgage Delinquencies: There are plenty of owners that once they are served with foreclosure papers they abandon the house as they are unable to pay the arrears.
- Taxes: When a property is seized for unpaid taxes and the owners are evicted it can sit empty until the municipality decides to auction it off, you can find these properties at the Tax Assessor’s office.
You can find properties selling below market value on an MLS search, depending on the market they can be really rare. Another option is to look at sites that list homes that are for sale by owner. Pay attention to local newspapers along with Craigslist to find homes like these. These sellers can be pretty motivated to get rid of the property quickly.
Elderly owners are no longer able to maintain their homes and are often looking to move to into something smaller and easier to maintain. Most of them are open to direct marketing campaigns, and you can find elderly owners from a direct mailing company.
There are plenty of ways to find distressed properties, network with people and let them know what you do. Keep an eye out as you travel around town you will find something before you know it.