Why Buy a Distressed Home?

With the housing market still struggling (although it is showing improvement), there are plenty of deals to be had. It is possible to get some exceptionally good deals on distressed homes. These are homes that are either in foreclosure or pre-foreclosure, or that have been vacant. Real Estate Pro Articles reports on why buying a distressed home can be a good move:

Low investment – Distressed homes are usually available at anywhere between 20-50% below the current market value and therefore involve very low investment costs.

High resale value – By buying a distressed home at a good bargain one can invest some money in renovating the property and then sell it immediately at a much higher price and earn a very good profit.

Low risks – As most distressed homes are government or bank owned and has a very transparent purchasing process, a distress home involves much lower risks as they are free of all liens in contrast to other real estate purchases.

Of course, you still need to be careful when you buy a distressed home, and be aware that there are still risks. You want to make sure that the title really is clean. And you also want to understand what you are getting into. In many cases, distressed homes are in poor shape, and may require some repairs. In the most extreme cases, you may have to get building permits to properly make renovations.