Real Estate Insights

It’s not surprising that according to specialists in Financial Planning Magazine, REO properties (Bank owned foreclosures) are considered “the best real estate deals” of 2010.  With the current volume of foreclosure activity and the amount of REO properties readily available for sale, it’s difficult not to jump back and feel like “a kid in a candy store.” 

Generally REO properties are a great investment as long as you know what you are getting yourself into.  There can be a lot of pit-falls to those who purchase foreclosed homes, such as tenants or squatters that need to be evicted as well as the deferred maintenance that usually accompanies REO properties. This is why it is recommended to work with an experienced REO buyer’s agent who understands the risks as well as the rewards associated with these properties.

And speaking of reward, it can’t be denied that in the current stormy real estate market, there are some real opportunities out there to buy up some great REO properties that are being offered for sale at bargain prices. There are seemingly thousands and thousands of bank owned homes sitting empty, just waiting for an enthusiastic buyer. 

As a Buyer, when you consider that the bank just wants to get rid of these homes, and if you find the right property and are ready to make the serious investment, it can be a great way to get off and running in the real estate investing business.  In fact, some banks are known to commonly offer their REO properties for around 30% of their value just to get them off their books. 

All you need is some capital, business knowledge and “a whole lot of patience” and you can be on your way to making some great investments.  You probably won't be able to flip these properties quickly, but if you can afford to sit on them for at least the next few years, then you stand a great chance of turning a good profit, especially if you've purchased high-end homes in good neighborhoods.

Read more about the pitfalls of purchasing REO properties