Every individual or family nurse their dream of having their own house or apartment rather than live in a rented property. The joy of being able to live in a place that is customized to your liking is immense, but comes at a hefty price sometimes. The real estate prices are driven by the economic forces of demand and supply, which causes a heavy fluctuation in property prices. So it is always good to keep alternatives in mind if you are not able to buy a brand new property.
How about investing in distressed properties and making the repairs or overhauling work? Distressed properties need not necessarily mean that they require a lot of rework, but can also refer to homes that have been given up by their owners if they are unable to pay their mortgage or if the maintenance of the property has become too expensive for them. The solution also has the potential to save you money in the process. However, if investing in such properties which require quite an amount of repair work is not your cup of tea, then you can opt for purchasing older properties that are put on the market at lower prices than their actual market rate.
Zeroing in on Distressed Properties
If you are not sure about how to identify such properties on the market, then it requires some digging work to identify these properties. One of the easiest methods is to simply take a walk or a drive around the areas where you want to buy your potential property. These properties may look neglected, not well maintained with the entire place collecting dust, possibly overgrown with weeds or an unmanicured lawn.
Check if there are notices posted on the property or if newspapers and other magazines are piled on the doorstep, then there may be a chance that the property is not inhabited anymore. Then go through the local listings to get more details about the properties. There are also another type of properties called underwater properties, which are listed on the local sites or under foreclosure websites. The availability of such properties also differ across countries.
In India, for example, such options are a rarity since home owners rarely default on their loan for the property to be auctioned. Moreover when there is a few only more loan payments to finish the overall property payment, then most home owners go for a loan restricting or some even save up the remaining payment and pay it at one go. Another easier method is to find properties that have been listed for delinquent taxes, the details of which can be found online for further examination. If you decide to buy a property that has been auctioned by banks, then the next step is to ensure you go through the bid documents carefully since such properties also have a financial liability because of which they are being sold.
Typically banks post advertisements of auctioned properties in the leading newspapers inviting bids from prospective buyers. Also factor in the time for acquiring the property which can take a couple of months. Last, to avoid any future legal problems, verify the house and its papers thoroughly.