Buying Distressed Homes In A Hot Market - Do’s and Don’ts

Finding a good deal on a house can be a bit tricky when the market is hot and the housing inventory is low. Many buyers turn to distressed properties thinking that they will get a good deal and fix it up themselves. In some cases distressed homes can be a good deal, in other cases, the buyer might bite off more than they can chew. Distressed properties are great if there are just a couple minor fixes and the property is insurable. If the home in un-insurable it means there are some major problems with the property.

Things to look for when buying a distressed home are the condition of the roof, siding, foundation, windows, septic, well and electrical. All of those factors can help you decide if the property is a good deal for you or not. If you are an investor needing to make a certain return on investment make sure you inspect all of the above conditions. If the roof needs to be replaced and the rest of the house is just cosmetic fixes it might be a good investment for the right person.

In a hot market, there are usually multiple offers on EVERYTHING, even distressed properties. Make sure if you are in a multiple offer situation, you only go up to what you are comfortable with and what makes sense if you are trying to make a profit on the house. Many times investors get caught up in the adrenaline of a bidding war and end up paying too much on the house. When investing you want to protect your margin of how much you spend and how much you need to fix it up.

Learn more about each type of distressed homes on the market here!