Cheap Homes for Sale: Finding Local and Lucrative Real Estate Investments

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For real estate investors, it can be difficult to predict how the housing market is going to change, which can make buying, renovating, and selling an investment property a very risky business.

With the housing slump, it seems that the consequences of investing could become more extreme as the market either worsens or improves drastically. What can seem like cheap homes for sale now can turn into overpriced homes within a couple of month’s time.

To get some bearings on this delicately balanced subject, some trends in housing values are discussed below.

Home Value Statistics

According to CNN’s Fortune and Money reporters, the national median home price is expected to rise at a rate of about 4% by the year 2012. This seems like good news for investors as long as they’re willing to wait until 2012 to sell, but most predictions indicate that prices will fall before they rise.

For example, between now and the first quarter of 2011, home prices in the Detroit-Livonia-Dearborn area are expected to fall by 5.5%.

When they rise by 4% in 2012, home prices will still have fallen 1.5% from their current levels. The calculated change in Detroit area home prices between the 2008 and 2009 third quarters is a fairly drastic plummet at 18.2%, which indicates that the values will continue to fall for some time.

Between July and August of this year, home prices in Detroit have fallen from $62K to $57K while the market has become more saturated with listings.

These statistics may not encourage real estate investment in the near future, but for those who are feeling lucky, here are some potentially profitable buys.

Cheap Homes for Sale in Detroit, MI

2460 Atkinson, 48206 is a foreclosure that offers three bedrooms and one bathroom for $14,900. The third floor and basement are both unfinished, allowing for significant improvements that could raise the value of the house.

This foreclosure at 6475 Rutland St., 48228 has three bedrooms and one bathroom for $2,000. It includes a generous amount of front yard property, a large front porch, and a basement.

Located at 7351 Bramell, 48239, this foreclosure includes two bedrooms and one bathroom and is going for $7,810. It includes a two-car garage, large backyard, and hardware floors. With some exterior improvements like paint or siding, it could be made more appealing to buyers.

How to Find Cheap Homes for Sale in Your Area

There are several options for finding cheap homes for sale locally:

• market listings
• real estate agents
• public auctions
• private sales
• and wholesalers like public agencies

Websites like auction.com allow investors to search for events by state, at which point they can be sorted by county, city, and asset type. They’re listed by auction start dates, so it’s easy to determine when an auction might be a good event to attend.

Recommended reading: An Auction Experience to Remember by Madison at My Dollar Plan.

For an example of a market listing website, realestate.com is a good place to start. Searches enable investors to refine their results by property type, city and state, zip code, price, number of bedrooms or bathrooms, or a home’s status as either existing, new, foreclosure, or rental. With comprehensive tools like these, it can be easy to find cheap homes for sale.

Alexis Bonari is a freelance writer and blog junkie. She often can be found blogging about education and scholarships for college. In her spare time, she enjoys square-foot gardening, swimming, and avoiding her laptop.

photo by respres

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