The meaning of the term “distressed property” might surprise you. “Distressed” doesn’t refer to the condition of the property itself, it simply refers to any home or property that is worth less than what is owed on the mortgage, and has owners who either can’t or are no longer willing to continue making mortgage payments. Distressed properties aren’t necessarily in poor condition, which makes them a popular option for home buyers looking for a reduced price or more inventory options.
Types of distressed properties:
Foreclosures are only one type of distressed property on the market. Others include short sales, which are properties sold for less than the amount that is still owed on them. Another type is Real Estate Owned property or REO. This term describes the property that has been reverted to the mortgage lender after it fails to sell at auction.
Advantages of distressed properties:
Distressed property can often be bought at far below market value, and while some tend to be fixer-uppers, some require minimal repairs and still others are move-in ready. Distressed real estate is a popular choice for investors looking to flip homes — that is, to buy them cheaply and then turn around and sell them for a profit at market value.
If you’re ready to check out distressed housing in the Denver area, the first thing you want to do is get a professional on your side. Metrowest specializes in distressed home sales and we’d love to help you start the process. Give us a shout today!