What is a distressed property?
A distressed property is a property that is either bank seized, or under foreclosure or may be owned by a government agency because of the tax lien. A property that is not well maintained and is in poor condition also comes under the distressed property. A home that stops midway through construction because of lack of proper permission or financing are also distressed properties but are not found that much.
How to get the best distressed property in Miami Beach?
When you are looking for a property you must have some specific preference of area and location where you would want to invest. So, when you are in search of distressed properties in Miami, there are certain signs which can signify that the property is distressed.
Identifying distressed properties
- Physical appearance: The physical appearance of a property is the biggest cue to know whether the property is distressed or not. Sometimes properties are simply not maintained because the owners are staying away or the owners may be too old to look after. So, in these cases, the owners are not always willing to sell the property.
- Life events: Sometimes circumstances like the death or divorce of house owners can make a property distressed.
- Financial condition: Sometimes some homeowners pay too much for their properties and as a result struggle to stay above water. In these circumstances, many homeowners tend to sell their houses.
- Debt of the owner: The monthly mortgage payments can give a clue whether the homeowner is actually becoming a gainer or a loser.
Common ways to find a distressed home
- “Diving for dollars”: Some real estate investors simply drive around the neighborhood looking for properties in bad conditions that can qualify for your list of distressed property. There are also degrees of distress of a property, and with experience, you will know which property is worth buying and which is not.
- Online hunt: There are also websites of distressed properties, and you can avail of those only with an internet connection. But also, be aware that there are hundreds of investors who are after this specific property, so act accordingly.
- Local auctions: Most of the distressed properties owned by government agencies are sold by real estate auctions to the highest payer. So, if you are willing to go on this route you should have enough cash in your hand.
There are also agencies these days that saves the time you would waste driving around the neighborhood or visiting government offices in search of distressed properties.