the long run. However, it's essential to conduct thorough due diligence, accurately estimate renovation costs, and carefully manage rental properties to ensure success with this strategy.
TYPES OF PROPERTY TO BUY
Now that you have a brief idea on how to analyzing a deal, let’s take a look at each of these options in more detail. While some investors might look at For Sale By Owner (FSBO) properties, many others focus mostly or completely on purchasing bank-owned properties. Some go to sheriff ’s sales or other auctions. But what type of properties should you be looking for? 1) Distressed properties; 2) foreclosures; 3) short sales; 4) and REO/Bank-Owned properties. Let’s take a look at each of these options in more detail.
Distressed Properties
Owners of distressed properties tend to be pretty desperate to sell, which means investors can often get them for less than market value. For these types of buildings, a popular option for investors is to wholesale them. This means the investors get the home under contract, then market it to other buyers for a higher price than their contract, and ultimately assign the contract to another buyer. The investor ends up with the difference between the new contract with the new buyer and their contract with the seller. For example, if an investor gets a home under contract for $60,000, then finds new buyers who agree to pay $70,000, the investor will make $10,000. A major advantage of wholesaling is that you don’t have to have a lot of capital, and there are many cheap — or even free — options
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