Profitable Colorado short sale investing
Many novice real estate investors may be surprised to learn that short sale investments are not guaranteed to be profitable. Of course, no investment is guaranteed. But many presume that buying a property at a steep discount below the current mortgages held on the property is a sure-fire way to get rich. It’s not.
Why isn’t short sale investing always profitable, whether it’s in Florida short sales, California short sales, or Colorado short sales? Because the reason the property is a short sale in the first place is that its value was over-inflated by the lenders in order to lend more money against it. Just because you are buying it cheaper than it was valued previously doesn’t mean it can’t be valued even less in the future.
All this is not to scare you away from purchasing short sales as investment property. It is only to underscore the need to get an experienced short sale negotiator on your side when making an offer on a short sale property. It’s important to find someone local. If you’re looking for a Denver short sale, find a Denver agent who is a short sale expert. Without such experts working for you, you are likely to fall victim to delays, price hikes (that’s why it’s called a negotiation), and bureaucratic frustration from bankers who don’t want to be the business of selling real estate.
There are tips and tricks that only the experienced real estate agent, who has negotiated many favorable short sale purchases successfully, knows. A short sale specialist will keep you from offering too high. A successful investor knows that most of the profit comes on the offer not the sale of the property. Don’t put off your profits until the sale.
Make an offer that makes your investment strategy work, don’t rearrange your investment strategy around the specifics of the deal. If the deal doesn’t match your criteria, or the bank doesn’t want to play ball, walk away. There are many others short sale properties to choose from. The right bank with the right owner in the right situation will make the deal you need to earn a respectable profit off of your investment, whether your strategy is flipping short sales or holding short sales long-term as rental property.
