How to be a Successful Investor in the Philadelphia Real Estate Market by Avoiding HUD Homes
There are many ways to become a successful investor in the competitive world of real estate. Unfortunately, it can often be difficult for the inexperienced investor to find their niche and begin turning a real profit, particularly in a big city area such as Philadelphia. There are several successful methods, however, that we at MyHouseDeals.com recommend for both new and seasoned investors alike.
Many first time buyers choose to peruse listing of houses with the US Department of Housing and Urban Development (HUD). HUD, through its affiliate the Federal Housing Administrators (FHA), provides loans to homebuyers. Should the homebuyer default on the loan, HUD steps in and repossesses it. This is the preliminary step to the home being placed on the market and resold at a lower price in an attempt by the HUD agency to regain its losses.
This is normally an excellent method for a first-time homebuyer to obtain a home in or near the city at a reasonable price and establish it as a long term, primary residence. However, this is not the best choice for a serious investor seeking to make a purchase with the intent to rehab and resell. HUD homes are owned by HUD, not an individual owner. HUD is an investment agency with its eye on the bottom line and how to maximize profit above all else. They want to recoup as much of their investment as possible.
In addition, HUD does not allow for an individual investor to make a deal on a home. This must be done through a HUD registered real estate broker who is working for a commission. Even though HUD will pay the broker's commission when the time comes, this essentially means the agent is working for the HUD, and not for you. The final blow to buying an investment property from a HUD agency, however, comes in the waiting period enforced after that property is placed on the market. HUD gives priority to home buyers looking for a home for themselves rather than one for investment purposes. This means the most lucrative deals will have been picked over before these properties are made available to investors.
There is a better way to invest in real estate. Philadelphia wholesalers can provide investors with an excellent opportunity to make a great deal of profit without the hassle that comes from seeking out a quality bargain property through normal means. These real estate professionals find the properties, get the house under contract to buy, and then resell them for a small profit margin to investors looking to rehab the home. Wholesale listings are generally not made available to the public, and as a result, the competition for these properties is not as intense and even rookie investors stand to make a huge profit after resale.
Motivated seller leads, or pre-foreclosure properties, are another means of obtaining properties at rock bottom prices. Pre-foreclosure properties are homes that are marked to be foreclosed upon and sent to auction but have not made it there yet. As a result, these properties are still owned by the private owner rather than the bank, and this owner is usually in a large hurry to rid themselves of the financial burden of their home; hence the term "motivated seller lead". This rush to sell, coupled with the absence of third party involvement, means that the clever investor is able to obtain the property for a much lower purchase price than would be available elsewhere.
So where do you find wholesale deals at motivated seller leads? The answer is MyHouseDeals.com. As a member of MyHouseDeals.com, we'll keep you updated about new properties in your area daily, and each new house added to the list comes with full descriptions, value and repair estimates, and full contact information for the seller. That's right. We do all of the leg work for you, so all you have to do is focus on establishing and expanding your business. Become a member for free today by clicking the button below!