In the USA, there are nearly 500 cities where the average cost of a home is $1 million, and many Americans are giving up hope of buying their own home. But even people who have purchased their own homes struggle to maintain their quality of life and keep a house running with increasing bills.
Distressed properties are classified as homes in a state of crisis and disrepair. In most cases, the people owning the house can no longer afford to pay the taxes or mortgages to keep living in the building.
For realtors, this presents an opportunity to transform properties. You can buy distressed property and help distressed homeowners find financial relief.
Keep reading to learn more about distressed real estate leads and where to find them.
Not all distressed properties look the same. Different categories of homes create different real estate value. The most common is a pre-foreclosure home or short sale, but there are other types of distressed homes. For instance, you can also find homes in the foreclosure process, bank-owned properties (REO), or a home with unpaid taxes.
You may also find distressed homes referred to as "underwater properties," but they both mean the same thing. The homeowner is no longer able to pay for the property.
Realtors are always looking for distressed properties with good deals that can be marketed at a hefty price. The first place to look for distressed properties is on a website allocated to these homes.
With a quick Google search, you can find a free site for distressed properties in a few seconds. This is great if you want options before making a final decision, but just understand that hundreds of other real estate agencies are likely looking at the same pages.
The competition for distressed properties is fierce, so you need to know what to look for. Here are the main things to observe in distressed homes:
Once you have a list of distressed homes you're interested in, it's time to reach out to the homeowners and ask if they want to sell. Depending on the property, it could take a while to find the homeowner if the home has been vacant for years or the tenants are no longer living nearby.
Some of the best websites to get started when searching for distressed homes are Foreclosure.com, HomeSteps.com, and HomePath.com. Otherwise, you can try cold marketing techniques to attract homeowners with distressed properties.
If you don't find many distressed properties with an internet search, the next tip is to try cold emailing or direct marketing to homeowners. You can do this through email campaigns or social media content aimed at distressed properties.
It's possible to do this marketing manually, but some apps and different software available online can give you a helping hand. DealMachine is a great tool that helps you reach your target audience by filtering through mail campaigns. Once you have a list of contact details, it's time to write a compelling message to potential sellers.
You don't want to come across as too pushy, so you need to consider your language in emails or social media posts. Overall, you want to be able to empathize with the homeowner and offer a solution that is beneficial to their lives. You never know why someone has a distressed property. Therefore, you should be mindful of your message.
Ideally, you should use words like "no inspections required" or "looking for distressed properties to save," and then you can build a relationship from there. If you convince a homeowner that you're giving them a solution and looking to take the home out of their hands, everyone will come out as a winner.
Property auctions are great for finding homes that banks or lenders have repossessed, and you can build a strong network by going to these events. Typically, local property auctions are posted online, but some postings still appear in newspapers which can be a great place to find small-scale auctions.
Banks occasionally post about property auctions, so keeping an eye on the current news and online posts from financial institutions is also worthwhile.
If you've never been to a property auction before, it's a good idea to start by observing the situation before making a bid. As this is a competitive market, you want to compare the prices and see how much people are bidding for distressed homes. This way, you'll be able to make an informed bid when the time comes.
Finding the right distressed home with a great value price can take a while, so you must be patient. Planning ahead and budgeting finances for your repairs and home inspections is excellent when you're still waiting for the perfect property to appear. If you have everything organized, you'll be ready to snatch your dream property when it pops up!
Remember to look over foreclosure laws to ensure you're not missing any legal information, and consider the neighborhood where homes appear for sale. All these things will make buying quicker, so you can start renovating as soon as possible.
The biggest obstacle for many realtors is finding the right pool of properties to buy that are in attractive areas and are worth their asking price. Our aim is to provide you with distressed properties with the most potential. When you sign up on our page, we can connect you with distressed properties.
If you want to discuss your options for real estate leads, our team will schedule a meeting at a convenient time for you. Schedule a meeting or call us at (402) 235-4556.