There’s no question that competition for distressed properties is heating up and will continue to do so. But there’s one under-served niche which could prove to put big profits in investors’ pockets with fewer competitors to battle against.
Acquiring rental properties is okay. Remodeling and flipping houses is okay, too. But they both present major challenges, not to mention their fair share of risk, plus a ridiculous amount of competition.
Buying distressed property notes from banks has become popular too and offers attractive passive income levels and great returns with fewer headaches and less hassle than some of the more traditional forms of direct real estate investment.
However, forward-thinking real estate investors and entrepreneurs, i.e., those who keep ahead of the game and consistently reap the biggest rewards, don’t make the big bucks because they gamble and are simply lucky. No, they recognize emerging trends and get ahead of the pack.
Those investors who want to really do something bigger are tired of competing with giant private equity firms at auctions, don’t want to deal with the stress of being a DIY rehabber, and they don’t want to rely on the whims of the market in real estate stocks.
So, where is the sweet spot others are overlooking?
If investors pay attention to what’s hot on the retail front and among those who really have the cash one of the most significant trends emerging is a return to teardowns and putting up shiny new multimillion dollar pads in their place. This is a trend surging from coast to coast, from Silicon Valley to South Beach, Miami and is accompanied by a surge in new construction developments.
The real beauty of buying distressed property notes is not just the consistent income potential and above market returns on interest. It is the multiple exit strategies they provide and numerous ways to profit from them.
What if you could target select distressed property notes at discounts on homes in these areas to get way ahead of competition, then foreclose on them or short sell them to those wanting to build custom homes or put up new luxury condos for large lump sums of cash?