Are distressed properties a good real estate niche?

One of the things you might choose to do after obtaining your real estate license to sell homes in South Carolina is to focus on a particular category in your sales and marketing campaigns. The term ''niche'' refers to such categories. Some agents develop a niche in various target markets, such as ''first time home buyers'' or ''vacation properties.'' Selling distressed properties is another type of niche that you might want to consider.

The real estate industry is ripe with investors who buy and flip homes. Such buyers look for properties that are being sold for low prices. The best homes for flipping are those that have a lot of potential for upgrades, are in prime locations or can otherwise be adapted to a higher list price level. After renovations are complete, they re-list the homes they have purchased and sell them for profit.

Not all distressed properties are in bad shape

A distressed property is usually being sold below market value. In many cases, such homes do not have a lot of curb appeal. If you're selling distressed homes, it wouldn't be uncommon for a particular house to have broken shutters or windows, peeling paint, cracked sidewalks, leaky roofs or other less-than-desirable features. Remember, it is not your typical home buyer who is purchasing these homes but real estate investors who are going to fix them up and re-sell them.

Not all distressed properties are falling apart homes in great need of renovation, however. Many properties become distressed (meaning, listed below market value) for other reasons, as well. For instance, if homeowners have defaulted on their mortgage loan, a property might go to foreclosure. Financially, this is a distressed property. The house itself might be in good condition but is being sold below market value as part of the foreclosure process.

Gross profits have increased in recent years for distressed property investors

Data shows that real estate investors who buy distressed properties have been raking in higher profits in recent years. This means that distressed property sales might be a lucrative niche in your sales region. If you're considering such properties as a niche, you'll want to ''take the pulse'' of sales in your area to see how many transactions include distressed properties.

Real estate sales offer diversity in that agents can work within multiple niches at a time. Once you have your license to sell, you can market your business in any direction you choose. If you try a particular niche and feel that it's not a good fit, you can re-focus your efforts elsewhere. Do you think that selling distressed properties is a good idea for your business? Then, give it a try and see what happens!

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