If you’re handy or have a team of expert contractors, you can earn great profits finding cheap fixer upper homes for sale.
When you buy a home for less than it’s worth, fix it up, and sell it for a higher price, you may make more than investors who buy and hold properties. Fix and flips aren’t for the faint of heart, though. It takes a lot of legwork including finding the fixer upper at the right price.
What’s the magic secret to finding cheap fixer upper homes for sale? We give you simple ideas below.
Use FlipScout By New Silver
FlipScout is effectively a search engine for house flippers and fix-to-rent investors. It helps you find properties that are below market value, while analyzing how much rehab work will be needed to transform the value of the home. The service is free at this moment in time, but you do need to sign up in order to use it.
Always Know About The Latest Foreclosure Auctions
Banks auction off foreclosed homes first before listing them. If they could sell the home without hiring a real estate agent they walk away with more money, which is good.
Before you bid on a foreclosed property, do your homework. Check out the listings yourself. You can’t go inside, but you can visit the area and get general estimations. Talk to neighbors and get as much information about the property as you can.
Keep in mind, at foreclosure auctions, you may need cash upfront or at least have approval for financing as banks want to close the transaction fast.
Check Online Listings Often
Zillow, Craigslist, and even Facebook may turn you onto cheap fixer upper homes for sale. Owners trying to sell the property before the bank starts foreclosure proceedings or real estate agents listing properties are all leads.
Whether you work on your own or with a real estate agent, stay on the lookout for the properties listed for less than the market value. If you have your eye on a specific area, find out the estimated value for the area, this way when you see a low-priced home, you can jump on it.
Peruse The Latest Notice Of Defaults
When a bank starts pre-foreclosure proceedings, it’s public record. In other words, you can find out which homes are at risk of foreclosure and strike a deal with the owner. Some owners may be actively looking to sell, while others may still be wondering what to do.
Check your local paper or the local recorder’s office for the latest NOD filings. If you find willing owners, they have to work out a short sale agreement with their lender. By buying the home before it’s in foreclosure, you help the sellers avoid the negativity of foreclosure while buying a home at a cheaper price.
Check Out Listings On The Market For Months
Some sellers don’t realize their home is a ‘fixer-upper’ and ask top dollar for it. As the home sits on the market for months at a time, they become more desperate to sell. Look for those homes that have many days on market and sharpen your negotiating skills.
Don’t insult the seller with your low ball offer – praise the home’s bones, but note that it needs some TLC that you and your contractors are happy to take care of if they are willing to let the house go for a lower price.
If the sellers sat on the home long enough, they may oblige as getting any offer to buy is better than sitting on it for months again.
Become The Local Expert
As an investor, getting to know the areas intimately give you the leg up on the competition. If you want to find cheap fixer upper homes for sale, you need to be ‘in the know.’ Look for the areas with the greatest profit potential and get to know the residents. Word-of-mouth is one of the best ways to find out about the latest fixer-uppers for sale.
Make it known that you’ll come in, buy a home, fix it up, and sell it. This excites neighbors because they know it helps their property value too. If you are the investor to help the area – the neighbors will be happy to help you.
Anyone Can Find Cheap Fixer Upper Homes For Sale
With the right work and effort, anyone can find cheap fixer upper homes for sale. Before you sign on the dotted line, make sure you know what you’re getting into. Have your team of professionals help you decide if there’s enough profit.
Talk to your appraiser, and contractors before bidding on the home and buying it. Remember that you can use the free FlipScout tool from New Silver to find high ROI flips.