Purchasing homes at the trustee sale auction has become increasingly popular throughout 2009 as the real estate markets have firmed.
When there is a big enough discount in the purchase price of a home at the auction vs. its full retail price on MLS, real estate investors will buy the home to either flip (resale) or hold for greater appreciation down the road.
Jim Klinge (aka “Jim the Realtor”) of San Diego interviews Adam Rappoport (aka “SD Realtor”), a realtor and active flipper of trustee sale homes. This is a very frank and honest discussion about the risks and process of investing in trustee sale homes.
Adam Rappoport Interview – Part 1 of 3
Adam Rappoport Interview – Part 2 of 3
Adam Rappoport Interview – Part 3 of 3
There is a lot of mystery and uncertainty about buying a home at the trustee sale: there’s no inspection period, deep pocketed buyers pay all cash to buy the property “as is” and “where is”.
The interview really gets into some insightful and insider details in parts 2 and 3 so make sure to watch all of the videos.
What surprised me the most was how the margins have shrunk this year. Notice Adam mentioned that his target margin was 20% per deal but now it’s down to 15% and the current deal was at 9%.
Another interesting thing is that every property he’s resold this year has had multiple offers because his group priced the home right.
What do you think about this interview? Please comment below.