Distressed Property And Wealth Creation

Category Advice

One of the main secrets to buying property lucratively is to secure it below market value, at the lowest possible prices. This includes homes that are about to become bank repossessed property, as well as other distressed property. This is because the method allows you to obtain the maximum amount of profit when the eventual sale is in progress. Although the concept is simple and easy to make effective, it is often overlooked by investors. Real time investors however look for buying property below their market value, which is an essential part of their investment strategy. In the emerging market, it is easy to secure below market value prices. That’s because, in an emerging market, the property prices are extremely low. Below market value homes include those which are about to become bank repossessed properties.

One of the reasons for low prices is that there is a substantial amount of capital appreciation that is created by the market forces. Usually, the property happens to be an off the plan option which is sold while it is still in demand, but has not become saturated. This initiates more people to make the most out of its usual demand and supply with the prices increasing as more and more people are likely to buy. One of the best scenarios in which to purchase property below market value is the off plan purchase. This helps the buyer to obtain the finance that is required for funding the construction as an essential part of the business strategy of the real estate developer.

Below market value property, or property that is about to become bank repossessed property, is a win-all situation on the part of the investors as well as developers. The developers look at time as money, when they can quickly obtain the deposit money of the buyer to advance their project. With the project advancing fast, the units can be built faster which can then be sold. This allows the construction work to progress to the following developmental level without delays. For the investors, making a timely purchase at the pre release stage implies getting the property below the market value with an optimum potential for securing high returns on investment.

Distressed property, or repossessed property, is usually bought below market value. This allows you to save much on the property, as much as up to 15% with pre launch prices from off the plan developers. The investors want to lock the extra capital in their property once the project is launched after a few months the units instantly raise their value. Once the contract is reassigned or eventually sold out, the investor in below market value property receives further returns on their investment for adding to the equity that is already made from the previously launched prices.

Buying below the market value is one of the favourite strategies for making flip investments where the investor buys off plan with the aim of reassigning the contract before it is complete. This is done to achieve the maximum possible profit through buying pre release. The investors are usually the first to buy on the realty development on the pre launch stage. This helps ensure that the investor not only gets to seal a below market value price, but that they even get the best units which are available at the outset.

Author: IMAGINE Properties

Submitted 03 Nov 16 / Views 4454