If you’re a house-flipper enthusiast or a real estate investor, you know that there are more ways to find old homes than by simply relying on sale listings. One of the best ways to find great properties for renovation are real estate properties in probate.
What’s a probate home?
A property left behind by the owner who died without a will is a probate property. When someone dies without any legal instructions as to how to administer his or her estate, the assets will be taken by the local probate court.
From there two things can happen. One, the assets and property can be distributed to the closest living relatives, according to the state law of intestate succession. Or two, if there are no relatives found, the property is reverted to the state which administers its sale.
Why invest?
If you’ve seen home renovation shows like “Fixer Upper” and “Flip or Flop”, then you have a pretty good idea why many people find it appealing to invest in probate real estate properties.
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Below - market purchase price. Who doesn’t love a bargain? Real estate investors are always on the lookout for cheap properties in good locations that they can turn into profitable investments, and it could be that corner lot property you’ve been eyeing. Probate homes in Charlotte NC are, in most cases, fixer-uppers, another reason for its affordable price.
Also, in many cases, the relatives who inherit the homes also already have their own homes. Due to the physical state of the house they have inherited and the possible cost it would need to rehabilitate it, they are not interested in keeping it. They would rather sell the house and use the proceeds for something else.
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Potential profit for reselling. Most home buyers prefer homes that are updated and move-in ready. Sold homes don’t cut it for them...unless you flip it. Then you can sell it for a better price, getting yourself a tidy profit.
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Less competition. This field has a lower competition rate than other fields of real estate, which gives you a high probability of success.
The Cons
Like in other real estate fields, real estate properties in probate also have disadvantages. Take a look at the list of cons below:
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Long waiting time for the court to decide. Because the decision depends on probate court, the waiting period can extend to several months.
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The property is still on a mortgage. Occasionally, you’ll stumble on a home in a good location that and would only needs minimal repairs, but is still in mortgage. This would result in a longer court processing time. All debts must be settled first before the house can be put up for sale on the market.
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The house is severely damaged and will require extensive repairs. As an investor, you’ll want to minimize your repair expenses. Since Charlotte probate homes are sold as is, you can avoid going over the budget by arranging for a property inspection before you purchase it.
Are you looking for a probate real estate specialist? We at Showcase Realty are happy to help you. Call us at 704-997-3794.
