Foreclosure Investing/Seattle Times 9/9/06 Article

Bill and DianaBuying Concerns, News, Personal Finance, Seattle Times Articles, Selling Concerns Leave a Comment

Kudos to Sarah Jio for her article on foreclosure investing in the Seattle Times on Saturday, 9/9. She interviewed an experienced, successful investor who imparted some key knowledge about the process of buying and selling foreclosed homes. However, an interesting bit of advice is where the invester recommends that one should not pay more than 85% of a home’s market value at foreclosure.

We wonder: how does the investor determine market value? Does he review tax records? Does he consult Zillow.com? Or does he utilize the services and/or opinions of a Realtor?

Reviewing tax records is tedious, and there are no pictures to give you an idea of what comparable sold properties look like. Zillow is known for inaccuracies exceeding 15%, not much help there aside from a cursive review. A good Realtor will likely give you a hand, perhaps at no cost to you, in the hope that you will list your property with him/her when it is time to sell. A good Realtor will also be an invaluable resource for trades-people you may need, and cost effective ideas for improvements.

You may be thinking that you wouldn’t use a Realtor to sell as it would take too large a bite out of your profit. Consider this: 80% of all “For-Sale-By-Owner” properties, year after year, regardless of economic conditions, eventually are listed and sold through a real estate company.

Save yourself a lot of work, and possible headaches, and use a good Realtor that intimately knows the market area in which you are considering investing. This may not be your regular Realtor/friend/relative that helped you purchase your home. If you trust your family Realtor, and are considering an investment outside your immediate area, ask your Realtor to refer you to a high quality Realtor in the area you are considering. You’ll be glad to have some professionals working for you with no out of pocket expenses. Your Realtor will put together a valid market analysis that will tell you what to spend on a given property, and what it will sell for.

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