Homes Sell Faster With Proper Rehab
In 2010, foreclosures set a new record, and they are expected to set another in 2011. or one in every 45 homes in the United States.
Most of these foreclosures become REO (Real Estate Owned) properties and are resold by the lenders who repossessed the homes. It is estimated that there is currently a three-year supply of these properties on the market. REO homes currently account for about a third of all real estate sales.
With this glut of REO properties for sale, one factor makes a big difference in how quickly these homes sell; Hire a qualified property preservation company to clean these homes and get them back in shape.
According to an independent study by Field Asset Services (FAS), a national property preservation company that handles 120,000 REO properties at any given time, foreclosures sell on average five months faster when properly cleaned and repaired.
FAS tracked over seventeen thousand properties in the first half of 2010 and found that, on average, there was a 68% reduction in the amount of time an REO property was sold if it was rehabbed. The rehab properties sold in just 69 days, as opposed to 222 days on the market for an unrehabbed home.
This means that the great business opportunity of property preservation will continue to grow in 2011. But the fact that property preservation makes such a difference in sales potential indicates that more and more REO sellers will invest more and more money to that these services are performed at the highest level possible, knowing that it will be the easiest way to recover your investment. .
What is the value of all the REO properties out there? Currently, the four largest lenders hold approximately $7 billion worth of REO homes, while Fannie Mae and Freddie Mac hold a combined $24 billion REO pool.
Even the government has begun to recognize that property preservation is essential to making sure these properties are sold. The Department of Housing and Urban Development (HUD) has committed $7 billion in grants to state and local governments, as well as non-profit businesses, to purchase vacant REO properties and repair them for resale.
That’s a lot of money on the table, and at a time when 25% of men between the ages of 25 and 54 are unemployed, property preservation in 2011 is an extremely viable and lucrative business, as well as an easy one to start. . .