Many investors across the nation have relied on the housing inventory created by the foreclosures brought on by the housing bubble that affected much of the country.
These properties can be bought at significant discounts making them desirable long term or short term investments. The markets that saw the most significant appreciation during the housing bubble have seen the most foreclosures and investors are quickly picking up these properties.
Investors can buy, rehab and sell these investment properties quickly. Most of their target buyers rely on traditional financing offered by banks. If the buyer cannot secure financing through a bank, the investor/seller may offer owner financing. Once the 1st lien note is created, an investor can service that note long term or sell their note.
In some markets, investors have seen the inventory of foreclosed homes diminishing. Ester Cho of DSNews in a recent article cited the findings of Pro Teck Valuation Services1 which indicates a lack of inventory in the top 10 major metropolitan statistical area or MSAs.
Four MSAs are found to be in the state of Texas and four in California. Investors in these MSAs won’t find as much foreclosed property to invest in as in other parts of the country.
Although Pro Teck Valuation Services is not predicting the full recovery of the housing industry to its prior level, it clearly points out that in areas where there is significant economic activity; housing seems to have begun to stabilize.
If you are investing in the housing market, some areas might not be as profitable as they might have been in the past; however, there are still good deals to be found in other housing sectors.
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This information is intended to be used as a general guide. It is not intended to constitute legal advice and is not a substitute for the advice of an attorney. While every effort has been taken to present the information accurately, this document may not be infallible. No warranty is made that these materials are current, complete, accurate, or suitable for any particular purpose. You should seek advice from your attorney before proceeding with any real estate transaction.
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