Questions for Distressed Properties

5 Replies

I've been cruising cl recently and have found a couple single family houses under $50k in decent areas. What are the important questions to ask right off the bat?

Are you looking for deals to wholesale or purchase for yourself? If you're looking for deals to wholesale you'll probably be out of luck (at least around here all the "deals" on CL are wholesalers trying to dump properties they have under contract). If you're looking for something for yourself you'll want to ask about the condition of the major stuff: roof & mechanicals (furnace/ac/water heater), and if there are any obvious repairs needed. Maybe when it was last updated. If there's a basement definitely ask if there's been any water issues. Also ask them why they're wanting to sell to see if you can get to their motivation. Hope that helps!

Thanks @Jim Viens  it makes sense that cl ads are mainly wholesalers now that you mention it. I'm interested in a buy and hold mainly or a flip depending on the numbers.

As a wholesaler, is it not illegal to advertise a property for sale if you are only indeed selling a contract?

@Derrick Strope  , that's actually very much open to interpretation on a state-by-state basis. Some places insist that you have actual title to the property before it can be marketed...others are fine if you only have equitable interest. Places like Ohio and, I think, Oregon are more restrictive so wholesaling is much more difficult in those places. Other places it's not really bothered with. But that's not saying it won't be in the future. I think it depends heavily on the amount of wholesaling going on and how much it encroaches on the business of licensed agents (and how many "shady operators" there are).

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you