Most people know the guaranteed returns in commercial and residential real estate investments. Others cannot wait to actualize their homeownership dream. Many would-be property investors, however, are holding back, waiting to come across a significant cash amount for their property investment. This way, they are guaranteed of better terms from mortgage lenders since they can afford a substantial down payment.
Though the truth is that property investment is a huge financial undertaking, there are several inexpensive options in this market. Foreclosed homes are among these affordable alternatives for property investors.
Buying a cheap property does not mean that it is a rundown shack you will be getting. With the help of real estate experts from companies like Tax Deed Investors, you can get some of the best available properties at astonishingly low prices. The following are the best options for those looking for a cheap property to invest in.
‘Price Reduced’ Properties
A property labeled “price reduced” sounds like a promising option, but most people would ordinarily start wondering if something is wrong with it. More often than not, there is nothing wrong with the property.
A seller might have set the price too high in the beginning and realized there was no one willing to buy the property at the set price. While you might not save much at first glance, most sellers would be willing to lower the cost further since they are panicky about leaving their property on the market for too long.
Foreclosures
A property is foreclosed when the owner stops making the required mortgage repayments for it. The lender then repossesses it and is probably eager to dispose of it so that they can get it off their books.
Most foreclosed properties are about 20% cheaper than in ordinary markets. However, you should make sure to factor in the inspection costs to get a clear picture of the property’s value.
Short Sales
These are sold by a property owner facing a risk of foreclosure to recoup some profit while averting a drop in their credit rating. Though the seller might be more than willing to settle, a short sale might be lengthy since the mortgage’s lender should approve the transaction.
The percentage you stand to save in this type of property investment is more or less the same as in a foreclosed property.
Inherited Properties
Few people live in the properties they inherit and yet rack up thousands in their maintenance costs. As such, many inheritors are willing to sell their property at a price lower than its actual value to avert the costs of maintaining it. Inherited properties are generally the lowest cost among investment properties though they tend to be in bad shape. So, make sure you have a thorough inspection to know what you are buying.
Real estate and cheap are not two words you will often use in the same sentence. The above options, nonetheless, guarantee that anyone can now invest in property irrespective of their financial muscle. As such, lack of finances should be the last excuse for opting out of property investment. The key to getting the best deals lies in working with a skilled real estate negotiator.
