The Value, Benefits, and Opportunity in Probate Real Estate

ICOR Blog & News ,

Many of us investors are facing the same problem today…lack of inventory of good properties to buy.  Have you noticed that the deals that come across your desk having slimmer and slimmer margins?  Construction costs are going up, properties on the market are selling for top dollar, and there is just a general shortage of properties to buy in many areas. Learning to work with probate real estate can solve these problems and create huge opportunity in your business!


ICOR May Event Focuses on Finding Off-Market Deals in a Niche Market

7 Ways to Make Money in Probate Real Estate
Wednesday, April 12, 2021 
6:00 PM - 8:00 PM (MDT)

CLICK HERE TO REGISTER


(cont.) We’ve all heard that saying that “two things in life are certain…death and taxes!”  It is death that creates the probate real estate market.  People die in a good economy and in a bad economy.  People die when real estate and stocks are up and when they are down.  People die during a pandemic and when there is no pandemic (naturally, we have seen more probate deals as a result of the current pandemic).  When people die, they leave behind property.  They leave behind valuable property and unvaluable property; real property and personal property; property that no one wants and property that everyone wants.  They leave behind property that MUST change hands.  That is where us investors come in!

I once was asked…”but are there really any good deals in probate?”

First and foremost, many of the properties in probate real estate have a ton of equity.  Just think about it.  A lot of times the elderly people that are dying have had the property for decades.  The property is free and clear.  In fact, some experts say that almost 80% of probate properties are free and clear or have a ton of equity.  That is a great thing because it gives you more flexibility on your offer price.   

With probate the people selling the property are selling someone else’s property.  It is someone else’s hard earned asset.  It is a gift to them (an inheritance) and sometimes they just want to get rid of it.  Sometimes they want to turn that house into cash as fast as possible!  That is where the deals come from. 

Probate is the ultimate distressed property.  The owner died.   How much more distress can you have than that?  In addition to the death of the owner, maybe the family is behind on mortgage payments.  Maybe there is no mortgage but they are behind on property tax payments and insurance.  There may be other financial or familial problems that are going on as well.  Maybe the property is in poor condition.  Often, the deceased owner didn’t have money for upkeep in the last decade or more and there is deferred maintenance.  Sometimes the properties are in “move-in condition” but they were last updated in 1960.  For whatever reason, they need work.  This is another layer of the distress that is quite common with probate real estate.

The financial condition of the parties that are taking over the property comes into consideration as well.  The ability of these heirs to manage that property and keep up with bills, maintenance, taxes, mortgages, etc all play a role.  Sometimes they just do not want to deal with it.  They just want a quick sale to get the money from the property.   

These reasons are exactly why there are so many good deals in probate real estate. A client of mine recently purchased a building that appraised at $1,200,000 for about $400,000.  It needed a ton of work, evictions on more than one unit, and someone to take control of the building in general.  The client turned it around and brought it back to a beautiful property.  Ultimately they sold it and made a HUGE profit!

 On May 22, 2021, I will be holding a 3 hour workshop called “The Value, Benefits, and Opportunity in Probate Real Estate”.  DO NOT miss this event.  It will 10X your business.  You will learn:

  • How to buy probate properties at a huge discount to market value
  • Where to find the diamonds in the rough
  • To generate a pipeline of probate deals that consistently delivers closed escrows
  • How to walk away with HUGE profits