Creative thinking continues to put a few ahead of the game in this weeks' real estate market. Instead of soaking in the barrage of negative statistics from the realty associations and industry officials, there are a few people acting and investing on a great idea.
And, no, it is not making lowball offers to try and prevent specific foreclosures. You see, it is not just "complete" houses that are owned (repossessed) by the banks. Unfortunately, many small builders have vanished from the scene. In some cases, this happened while one or more single family homes were still being built and thus not yet sold.
I got curious when I saw that someone bought a 3,000 sq. ft. house in Central Florida for $28,000 cash and may have been the only actual bidder. Upon further investigation, the buyer got himself an unfinished house that was left for dead by a failed builder. In today's market, consumers and investors who can afford to take advantage of the deals out there want something they can turn a profit on without having to spend any more to do so. Yet, in this instance, it translates to missed opportunities.
This buyer/investor estimated that the house needed about $50,000 more worth of work to be completed, and he has the contacts (and the finances) to make that happen. The result is that within a few weeks, he will have a completed and brand new 3,000 sq. ft. house in Florida ready to sell - or rent. And his total cost will likely be under $80,000, with no mortgage.
If over the next few weeks the market doesn't improve to the point of easily being able to find a buyer, he knows the rental market is strong among people who don't have credit worthy of getting a mortgage. Better yet, there will likely be a ton of "rent to buy" candidates out there.
Those who rent to buy make much better tenants, as they are not likely to let necessary household matters slide.
This, after the bank which "took over" this unfinished property was amazed to get rid of something they couldn't sell against the foreclosures ready for immediate occupancy.
What gets me is that this investor/buyer, to the best of my knowledge, is NOT a licensed realty agent.
Now put this together with the usual batch of negative real estate market stories started by the people in the industry. Notice that the realty associations continue to release the "down market" statistics so fast it's hard to keep up:
Now the Chicago market joins the rest:
Let me get this straight. The realty agents and mortgage lenders complaining about the lack of business (except for mortgage refi's) are sitting around reading the doom statistics, while investors not in the profession are using creative thinking to score a nice profit within the course of the new year.
What's wrong with this picture?
3 days ago