I used to flip foreclosure properties leading up to the height of the RE bubble. It was tough work finding these properties, marketing to them, and then screening the potential sellers. Since I didn’t have the capital to buy the properties myself, for cash, I had to get an investor involved and made a few bucks at it. I learned a lot but realized that it was too time consuming so I stopped.
Once I found a property, I would go to my real estate investment group and search for a buyer. Right before the top in the market, the message board would be filled with 100’s of daily posts. People looking for this, selling these deals, investors with cash, flipping, etc. Then about 3 months before the peak, the post frequency started to lessen. I thought to myself, hmm this is something to watch. Little did I know that the top was about to be made and since then the RE activity in the group has been a quarter of what it was.
I know a lot of the people on that board, either I met them in person or have corresponded with them. They’re shrewd business people and they have their ears to the ground. The word on the street is that bottom is NOT in yet and their waiting to swoop in on the carnage when banks and lenders are saturated with foreclosed houses. Why bother dealing with crazy homeowners when you can just go to the bank and make a deal?
My wife and I are estimating late 2008 for a possible bottom but it remains to be seen. Probably September of next year we’ll be going to our local banks and asking for their REO lists (Real Estate Owned). These are the properties the bank owns and typically tries to unload fast. Sometimes they get Realtors to sell them for them but since no one is likely to be buying, you can go in there and negotiate rock bottom prices. When I mean rock bottom prices, I mean really rock bottom prices. Our goal is to pick up a nice little Jersey Shore house. :)
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