Buying Foreclosures

Heard the news ? Wall Street is down. And it's been caused by the U.S. Housing slowdown! Here's What This Means for Real Estate Investors, millions of Americans are trying to sell their homes, and the latest news from the Mortgage Bankers Association (MBA) isn't good. The MBA sees sharp drops in sales of both existing and new homes this year, with mild rebounds expected for 2009.

Buyers, on the other hand, couldn't ask for better news, earlier projections that had the housing market recovering early in 2008 would have left buyers scrambling to take advantage of the busy spring sales season, potentially leading to increased competition and driving up prices.

With slow conditions expected to continue throughout the year, however, buyers can go through the process at a more deliberate pace without fear of missing out on the best prices. The MBA believes median home prices will fall about 2% in 2008 but regain most of that entire drop in 2009.

So how do you take advantage of all this? It's simple - buy low and sell high. While the media continues to make "generalizations" about the real estate market, there are investors quietly buying up bargain properties in emerging markets.

There are different strategies for investing in real estate and specifically in foreclosures. People should stick to the one that most reflects their investment goals. When scouting the market for foreclosed homes there are many resources that you can rely on, some free and some costly.

One option that foreclosure investors have is paying for a foreclosure listing service; many websites offer these for a low monthly fee. However, since this information can be obtained for free many investors choose to do their own legwork and get these lists directly from lenders or county record offices.

For the most part the results are the same, although if you do get a paid listing service make sure to research the company as some have more up-to-date lists than others. Another great resource is a local Realtor, if you have the option cross reference your lists with the realtor’s knowledge of neighborhood statistics.

They can help by telling you valuable information such as what price ranges houses have been selling at in specific areas. Also be sure that the person you’re working with has your best interests in mind and not their own.

Overall, buying and selling foreclosed and pre-foreclosed homes can be a lucrative investment. Just make sure to take your time and research any opportunity before you commit to a project that you might not be able to handle.

For more information on buying foreclosures read about some of the leading investors and trainers in this field, Thomas Kish.