Real Estate Investing Blog

When you get right down to it, real estate investment is all about the deal. Because of this, it should be clear that evaluating deals is an important part of your success as a real estate investor; however, it doesn’t always seem as though evaluating deals is something that people take as seriously as they should.

While looking for details that are out there and considering others’ opinions about real estate investing, this was something that caught my eye:

Ask your buyers agent to prepare a comparative market analysis of the short sale home you are preparing to make an offer on. Depending on how long the owner has owned the home or how long it has been in default they could owe the lender more money on the mortgage than what the house is worth. This could actually bring the list price up to current market value rather than below it.

When it comes right down to it, the CMA of a property is a vital step - especially when you consider that the market prices are still going down in some areas - of evaluating the deal. Your goal with a short sale, after all, is to purchase the property for less than you will be able to sell it for; if the current owner owes more for the property than its current value, it is going to be extremely difficult for you to get the home at the right price (the price that will let you turn a profit).

Evaluating deals is vital - if it is a step that you try to overlook or skip over, you’re likely to find out the hard way just how important it is.

This entry was posted on Sunday, June 29th, 2008 at 6:01 pm and is filed under Evaluating Deals. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.