While single family rental property foreclosure purchase has become one of the most widely used investment strategies at present, there are times when individual real estate investors especially those that are part of the markets that are already picked over by huge institutional investors find the whole strategy nonsensical and insignificant. Still, there are favorable advantages out of purchasing foreclosed single family properties and make these available for rental. This can greatly benefit conservative and individual investors who have decided to buy foreclosures and other properties and treat them as single family rentals.
Single family rental property foreclosure purchase has actually turned out to be a popular investment strategy due to the huge increase in the number of tenants and renters that are greatly affected by foreclosures. This financial downturn has actually resulted to millions of foreclosed properties. The majority of the occupants of these foreclosed properties are the actual homeowners who tend to move quickly to look for alternate houses with little notice. These homeowners are actually joined by bunch of renters who have eventually discovered, usually without any warning, that the apartment or house that they are renting is already owned by a bank.
Presently, lots of homeowners have realized that one of the best exit strategies for firms that have decided to implement the single family rental property foreclosure purchase for distressed homes is to convert properties into REIT (Real Estate Investment Trust). This actually refers to a security which sells quite similarly to stocks on major stock exchanges and makes direct investments in real estate either through mortgages or properties. REITs often get special tax considerations while also offering high yields to investors and a highly liquid solution to real estate investing. Aside from deciding to flip homes earlier than expected or convert the properties to REIT, becoming a home lender is also an effective exit strategy for institutional buyers.