Investing in the troubled property

Buying a troubled property is going to be the next big thing in the realty market. Two of the most popular type of such troubled property includes the Foreclosures and The Real estate owned houses.

Profits in such investments are not overnight. Investing in troubled or distressed properties is for investors who can hold on to the property for long periods of time or for those who are into realty flipping strategies. In order to be successful in this type on investing you must locate a property where the mortgage can be covered by the rental income from the same property. Such cash flow arrangements can be achieved by renting out for long term to families or short term lending of the property for vacation rentals and tourists or individuals in transit or companies who would like to own guest houses for their visiting executives.

A little know trade secret is to purchase properties from big time real investors who are into the sale and purchase of bank portfolios. Portfolio purchases are generally are priced lower than the combined market value of all the properties in the portfolio. This helps you in securing a good lower than market value asset from the main purchaser since he has nothing to lose. It’s a kind of win – win situation for both of you.

There is no doubt that money can be made by investing in such troubled properties. But there is no quick and easy solution. Market suggests holding onto the property for a period of around 8-12 years in order to triple or quadruple your profits.