I received an interesting call yesterday.
Turns out the caller, who’s part of a fairly large and well known real estate company (at least around the Detroit News classified ads), had just picked up a block of 100 foreclosures directly from a lender without going through a realtor.
Big deal you say. Happens all the time.
Maybe, but that wasn’t the noteworthy part of our conversation. He went on to tell me that this was part of the one lender’s effort to “clear the decks” before they blow out a ton of their foreclosure inventory before year-end.
A tidal wave, he said. His words, not mine.
And this really isn’t all that surprising. You see, accounting rules are pretty strict as to when you need to take a hit for bad or uncollectible debt, and it seems like lenders have been trying to string it out as long as they can. But ultimately they have to pay the piper, and it looks like this is the year they start cleaning out their balance sheets.
Which just so happens to be good news for us. I’ve never seen so many nearly-no-rehab foreclosures available, much less available at something like 40% or less of ARV. I found a half dozen of them just a weekend ago.
Finding the deals used to be the biggest challenge in this business. Now it’s deciding which deals to do. (Which is a conversation unto itself. More on this later.)
In the mean time, get ready to catch the wave. December 2007 may be the best month to buy Detroit area real estate in history.