Turn Ugly (and Ideal) Properties Into Beautiful Profits!
The key to success in the wholesale real estate market is finding properties other investors don't want! This article shows you how to identify those properties fast and generate profits quickly.
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Ideal Properties in the Wholesale Market
Make Maximum Profit with Ugly, Damaged, Distressed and Older Properties
In order to achieve maximum profit on all your deals in the wholesale market, you need to target properties carefully. Below is a list of ideal properties to concentrate on.
Vacant,Abandoned,Boarded-Up Houses
For various reasons, no one wants these properties-code violations, homeowner association violations, etc. Often, the city requires them to be boarded up so vandals can't enter and do damage.
Code Violation Properties
These houses don't meet city standards, and the owner(s) have been cited for code violations, so no one is living in them.
Distressed/Ugly Properties
They're ideal because they need a lot of work and no one wants them. They're unmarketable.
Older Properties
They may require more work than the owners are willing to put into them. Therefore, they're more willing to sell to you.
Fire-Damaged Properties
There are plenty of investors who will buy fire-damaged houses, especially if the entire house isn't burned down. You can find such properties by driving a neighborhood. Depending on your local laws and regulations, you may also be able to contact the fire marshal's office and get a list of fire incidents in your city and/or county. They may charge you a fee for this service, however.
Flood-Damaged Properties
Often, owners don't want to deal with the severe damage to these properties so they're willing to sell at bargain prices.
Mold-Damaged Properties
Mold often goes hand in hand with flood damage. It can be expensive to get rid of mold, and there's also the health hazard. So, owners are more willing to sell.
Large Insurance Claims
These often occur in relation to fire, flood, and mold damage. The insurance company pays off the claim, and the owner ends up with a free-and-clear house, but one that requires a lot of fix-up work. It may sound odd that fire, flood or mold-damaged properties would be an ideal target for you. But, wholesaling is all about price!
For example, let's assume a house is so damaged that it needs to be torn down. You still have the lot. Now, assume the lot is worth $10,000, and you can get the house under contract for $1,000. Then, you sell it to another investor who buys the house and the lot for $5,000. You have $4,000 profit, and the investor is still getting the lot at a bargain price. Everybody's a winner in this situation!
It can be harder to find insurance-claim properties than the other types I described. One way to locate them is to build relationships with public adjusters. Insurance companies hire them to come out and look at policy holders' claims. For a fee, they'll refer a seller to you who doesn't want to fix a property up or wants to sell it as-is. Give them a business card and tell them you'll pay them $1,000 (or whatever amount) if you end up buying the property. Note: Before you take up this practice, make sure it's permitted under your local and state laws.
Vacant,Abandoned,Boarded-Up Houses
For various reasons, no one wants these properties-code violations, homeowner association violations, etc. Often, the city requires them to be boarded up so vandals can't enter and do damage.
Code Violation Properties
These houses don't meet city standards, and the owner(s) have been cited for code violations, so no one is living in them.
Distressed/Ugly Properties
They're ideal because they need a lot of work and no one wants them. They're unmarketable.
Older Properties
They may require more work than the owners are willing to put into them. Therefore, they're more willing to sell to you.
Fire-Damaged Properties
There are plenty of investors who will buy fire-damaged houses, especially if the entire house isn't burned down. You can find such properties by driving a neighborhood. Depending on your local laws and regulations, you may also be able to contact the fire marshal's office and get a list of fire incidents in your city and/or county. They may charge you a fee for this service, however.
Flood-Damaged Properties
Often, owners don't want to deal with the severe damage to these properties so they're willing to sell at bargain prices.
Mold-Damaged Properties
Mold often goes hand in hand with flood damage. It can be expensive to get rid of mold, and there's also the health hazard. So, owners are more willing to sell.
Large Insurance Claims
These often occur in relation to fire, flood, and mold damage. The insurance company pays off the claim, and the owner ends up with a free-and-clear house, but one that requires a lot of fix-up work. It may sound odd that fire, flood or mold-damaged properties would be an ideal target for you. But, wholesaling is all about price!
For example, let's assume a house is so damaged that it needs to be torn down. You still have the lot. Now, assume the lot is worth $10,000, and you can get the house under contract for $1,000. Then, you sell it to another investor who buys the house and the lot for $5,000. You have $4,000 profit, and the investor is still getting the lot at a bargain price. Everybody's a winner in this situation!
It can be harder to find insurance-claim properties than the other types I described. One way to locate them is to build relationships with public adjusters. Insurance companies hire them to come out and look at policy holders' claims. For a fee, they'll refer a seller to you who doesn't want to fix a property up or wants to sell it as-is. Give them a business card and tell them you'll pay them $1,000 (or whatever amount) if you end up buying the property. Note: Before you take up this practice, make sure it's permitted under your local and state laws.
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