Buying Short Sales and Foreclosures

A Foreclosure House for Sale Sign in front of a House

If you are an investor or potential homebuyer, then you are more than likely in love with the current real estate market. Although most markets are making significant strides toward recovery, there are still some incredible real estate deals on the market - especially when it comes to short sales and foreclosures.

Discounted properties are the perfect investment opportunity for those looking to purchase a home on a budget or investors seeking to buy low to maximize their profits. Throughout 2013 you will still be able to find both foreclosures and short sales; however, they may become increasingly harder to find in some areas as the year progresses.

Rising Home Prices

Although there are still great foreclosure deals and short sales on the market, home prices throughout the country are rising and are expected to continue to increase throughout the foreseeable future. In fact, according to the S&P/Case-Shiller Home Prices Indices, home prices rose in 19 of the 20 cities surveyed from November 2011 to November 2012.

Below is a video with more information on the S&P/Case-Shiller report:

Short Sales vs. Foreclosures

Over the last few years, one of the most debated topics is whether foreclosures or short sales are better investment opportunities. In the end, it is basically depends on which properties you can find in the area in which you are considering investing, as well as the quality of the home in comparison to the cost.

With lenders being pushed to help struggling homeowners avoid foreclosure, there have been more short sales entering the market in recent months - a trend that will more than likely continue throughout this year as well.

Both short sales and foreclosures can be great investment opportunities, often being able to be purchased below market value. However, these properties tend to require some minor to moderate renovation; therefore, the costs of these renovations should be taken into consideration when determining if you are getting a good deal on the property. There are more similarities between short sales and foreclosures, with the most noticeable difference being that short sales tend to take longer to purchase.

At the end of the day, both short sales and foreclosures can be great investment opportunities for both investors and potential homebuyers. The most important thing is finding a home that you are interested in purchasing and then being patient, understanding that buying foreclosures and short sales can take longer than buying a home at market value.

As long as you have patience and you make sure you find a property that is a good deal - even taking into consideration the cost of needed repairs - then it does not really matter if you are purchasing a short sale or foreclosure property. The goal is finding the right property for your investment needs - not picking between foreclosure and short sales.

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