What is the most desirable real estate? Each state has their own areas that they tout as “the best place to live”. These locations are not going to come cheap. I say that the most desirable real estate is not about location alone, but about opportunity and price.
One such category of desirable real estate property can be found anywhere and everywhere. It is the “foreclosure”. You may be thinking, “How can a foreclosure be desirable?” The term seems to carry a bit of a stigma. A foreclosed property can be an unearthed treasure when the right opportunity comes along.
Foreclosed properties are those where the borrower has defaulted on their loan with a lending institution. A default is typically defined as payments that are two or more months in arrears. The lending institution then has the option of taking back the property and reselling it to the highest bidder.
Foreclosed properties can also be those ceased by the government for one reason or another. These homes are not always the rundown houses that people imagine. Foreclosures can occur for any number of reasons to people in any tax or income bracket. They can be situated in any city or any neighborhood, affluent or middle class.
Because owners have the right to make back payments to the lending institution for a certain amount of time, it is best to pursue foreclosures when the borrower is out of the picture. If the home is a recent foreclosure, the potential buyer must deal with the seller when negotiating price for the real estate property. Certain disclosures must be made by an investment buyer in order for the final sale to be legal and uncontestable.
For the enterprising individual, a foreclosure can be purchased for the amount owed to the lender and resold for a profit. For someone looking to own a home, a foreclosure can present them with a lower monthly payment for more house than they could have gotten otherwise. As a residence, monies can be found to repair fixer-uppers that will fetch a higher price later on.
REO’s or real estate owned properties are those that are owned by the mortgage lender. The house has already been foreclosed and repossessed by the lender. The asking price for these real estate properties is sometimes less than the amount still owed.
An auction of the property did not yield a satisfactory price from the bidders. The lender wants to get rid of the property and will take the best offer. Since the seller is out of the picture, you will deal with the lender and their agent. An investor can purchase these types of properties for a great price.
Another type of foreclosed property is the short sale property. This real estate property is one that has been foreclosed, but not gone to auction. The lending institution will get less for the property than the seller owed which is a good deal for the buyer. The lender makes a deal with the potential buyer since they cannot get their money from the seller.
So, where is the most desirable property? It can be anywhere. Check national foreclosure listings for foreclosed and other distressed real estate properties in your area. As always, seek sound investment advice before purchasing any property.