How To Make Money Off Foreclosures
The thing about foreclosures is that they are not isolated incidences endemic to 2006-2007. These are things that happen every other day. There are hundreds of thousands of houses in foreclosure and even millions more staring down that terrible financial abyss. It is only logical that a smart property investor would look to find ways through which they can make money from foreclosures, considering the fact that this is not just a passing phenomenon. With that in mind, here are some tips on how you too can make money from foreclosures.
First things first
Before you even start thinking about chasing properties in upmarket London neighbourhoods; properties that you could otherwise afford but for their foreclosure, you need to know one thing. Buying homes that are in foreclosure will need you to have a truck-load of cash on hand. In many cases, the lending companies that are looking to offload these properties want nothing else but to recoup their investment.
That means getting cash for these properties. Unless you can provide that cash-flow, they are more likely to consider your competitors that can. So be prepared. That being said, here is how you can make money off foreclosures.
Buy it and sell it
This is by far the most straight forward way of making money off foreclosed homes. Because these properties almost always go up for sale at a fraction of the actual market value, you can get really good deals if you buy the property with the intention of selling it later on. The lending companies often cannot wait for that period and tend to need their money back immediately.
So, if you have the money to buy that beautiful London apartment that is in foreclosure, do so and wait. As recent history dictates, the property market in such luxurious places always bounces back. So just sit on the house and wait for the right moment to sell it at a ridiculous profit.
Turn it into an HMO
You could also buy amazingly spacious homes for a steal and turn them into a money-making venture such as an HMO. You will, however, incur additional costs such as remodelling the home into an HMO, licensing it to operate as one and hiring a property management company to run it for you. Apart from that, the monthly income received from these types of properties, especially if they are in beautiful neighbourhoods with great tenants, is something worth considering.
You could also buy up the properties just so you can rent them out as single homes instead of splitting it into an HMO. The choice is yours. Although, your chances of making more money from an HMO as opposed to a single unit rental are higher.
You could also buy up luxury properties and rent them out to the film industry. Imagine if you owned Downton Abbey? It is all a matter of thinking a little outside the box with these sort of properties.