Are Vacant Homes a Good Investment? 3 Telltale Signs of Vacancy

There are tons of options for Real Estate investors. Some buy to rent, others flip before the ink is dry on the contract. Still others middle-man the opportunity and sell contracts to other investors. Whether you’re already in this business or just getting started, the important thing is to know what your goals are and focus on the opportunities that’ll help you meet them.
Abandoned Foreclosed Cape Cod Home Long Grass

There are tons of options for Real Estate investors. Some buy to rent, others flip before the ink is dry on the contract. Still others middle-man the opportunity and sell contracts to other investors. Whether you’re already in this business or just getting started, the important thing is to know what your goals are and focus on the opportunities that’ll help you meet them.

In future blog articles we’ll discuss what’s involved in holding on to investment properties as income properties. Residual income can be a good thing—as long as you know what you’re in for and willing to work toward it.

What we look for in any aspect of the real estate investment business are motivated sellers. We’re more likely to find them when a property is vacant. Why? Because there is usually no more motivated a seller than one who is paying the mortgage and/or property taxes on an unoccupied property. A motivated seller will often be willing to cut a deal at a much lower price. If you can buy a home under value, you’ll tip the scales in favor of maximizing your investment.

Real Estate investing is a great way to generate income as long as you understand what you’re doing. Learning about what to look for, who to target and what you want to do with the property (or contract) once you own it is essential to your success.

Today’s blog article addresses seeking out and purchasing abandoned or vacant properties. There are specific things to look for and some of these things you’ll want to pay very close attention to if you’re going to maximize your investment. We’ll discuss three of those things below.

Real Estate investing is a great way to generate income as long as you understand what you’re doing. Learning about what to look for, who to target and what you want to do with the property (or contract) once you own it is essential to your success.

3 Signs of Vacancy

An Empty House

Sometimes even the window treatments are missing in vacant houses and you can easily identify them by looking from the street. If a family is forced to move for one reason or another, owners sometimes take everything that isn’t nailed down. Actually, some use tools to remove the nails and take banisters, tiles and other valuable features in their homes—especially if they paid a lot for them (or in many cases are still paying off credit card charges). This can also occur when a renter is evicted.

In any case, the vacant home might not be in pristine condition and you’ll need to consider whether it’s a worthy investment. What will you have to invest to bring it up to code or make it an attractive resale purchase?

Accumulated Trash/Debris

If trash cans are filled to the brim or if there’s debris in the yard, this might be a sign that the home is abandoned. Even if there’s furniture inside, evaluate whether it’s actually occupied.

After the Northridge, CA earthquake in 1994, many property owners simply walked away from their homes. On top of being scared, the prospect of accruing tens of thousands of dollars in repairs were for some not worth the investment. Realtors® said many property owners left all but their personal belongings for a quick getaway. It’s been over 20 years since a major earthquake in California, and chances are you won’t find homes abandoned for that reason, but there are other reasons this might happen.

Overgrown Landscaping

If you find a house with overgrown landscape or tall grass in an otherwise perfectly groomed neighborhood, you might want to look closely to see if it’s vacant. Sometimes out-of-state family members inherit properties from deceased relatives and are holding on to them because they’re not sure what to do. They might be motivated to sell for the right price. Remember, you have a right price too, and don’t settle for an investment that isn’t going to provide an attractive ROI.

No matter what your investment preference, your goal is to make a profit. If you follow a solid plan of action, you will make money. If you stray from your plan or make emotional decisions, you put yourself at risk.

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