Article: Savvy Buyers Know The Ins And Outs Of Flipping

Yesterday's Miami Herald featured an interesting article about those that are taking advantage of foreclosed properties.

Such foreclosed properties will likely be priced low; are being sold by a bank (who needs to sell the property, and is thus seen as a motivated seller); and can often bring other opportunities to potential buyers - such as allowing them to purchase particular properties or in areas that would normally be unavailable.

Buyers of these properties would normally only ever deal in cash, given the current difficulty in raising suitable credit. Furthermore, purchasing properties in cash may also negate the possibility of running into future financial difficulties.

Once a foreclosed property is bought, the new owners undertake renovations and then either sell the property on or - more likely - rent it out. In this way, people can buy a reasonably priced property and begin earning income from it whilst it appreciates in value - if not immediately, given the current housing market, in the long term at least.

Bob and Meg Massing of South Carolina are shown in the article as example of those undertaking the above. They only buy properties for cash and usually do most of the renovations to the properties themselves, thus keeping their costs low.

Randall Porter of Ohio is also featured in the article, dealing in very-low priced homes. (He talks of purchasing a property for $12,000.) Porter is also a good example because he takes full advantage of the Internet to the do his research. Whilst the number of foreclosed properties in his local area may be considerable, very few of them may be suitable for him to buy for one reason or another. When looking to buy a place, he whittles down the number of properties to only a handful, and then tracks these online to see any changes in price or status before comitting himself into making an offer.

So, readers, a foreclosed property might be the thing for you too.

Article: Savvy buyers know the ins and outs of flipping (9th November 2008, Miami Herald)