Foreclosures are abundant all over the country and Virginia is no different. Although the area inside the Beltway has seen little depreciation, the rest of Virginia is a different story.
Virginia homeowners have seen their property values decrease by up to 50%, depending on the part of Virginia they live in. Declining employment, the drop in value of the stock market, the sub-prime meltdown and the general economic recession have led to many homeowners falling behind on their mortgage payments and, sometimes, losing their home.
While the loss of a home is a personal tragedy, it also creates an opportunity for someone else. Whether the home is bought by a homeowner or an investor, it eventually provides a place to live for the owner or a tenant. And if the investor is buying the property to flip, it is usually returned to the housing stock in an improved condition.
Buying a foreclosed home in Virginia is a great investment, given the current low prices of homes and the historically low interest rates. When these two factors are combined with the number of foreclosures in Virginia, this creates a “perfect storm” for the investor.
The savvy investor can pick up a home at well below its previous market value and either resell it to an owner occupier or rent it with a positive cash flow, allowing the buyer to acquire the house through the rental payments.
One of the questions that is often asked is “Is now the right time to buy, or will the market go lower?” The truth is that nobody knows – it is never possible to predict a market bottom, it only becomes obvious after prices start to rise again. So, unless you are extremely lucky, you will not get in at the absolute lowest values. But, given the slight improvement in the market, the slow-down in price reductions and the availability of “cheap” money, now is certainly a good time to buy.
And for investors who are worried about the possibility of getting stuck with a house that they can’t rent, you only have to think about the number of government,. federal and state workers in the Commonwealth of Virginia to realize that there is always a strong demand for accommodation.
So, if you are looking to buy a home, either for you and your family to live in, or as an investment, you would do well to buy one of the foreclosures available now in Virginia, before the market values and mortgage rates increase and the proposition becomes less attractive.