Consider this: Only 2-5% of real estate investors actively pursue short sales. It’s surprising, given the potential profits and opportunities in this niche, but when you dig into why, the answer becomes clear.
First, short sales require more knowledge to handle the paperwork, and the process can take longer than traditional real estate transactions. Many investors find the extra effort daunting. Additionally, during the 2008 housing crisis, short sales saw a 400% increase, but banks were overwhelmed. With staff turnover, lost documents, and poor communication, short sales gained a reputation for being difficult and frustrating.
In recent years, during the period of easy money, where investors could buy high and sell even higher, many chose to avoid short sales altogether, focusing instead on quicker, less complex deals.
Why Short Sales Matter Today
Fast forward to today, and the situation is very different. Banks are now better staffed with stable teams, and short sale transactions have become much smoother and easier to complete for those who understand the process. This change opens up a window of opportunity for savvy investors willing to learn how to negotiate with sellers and lenders.
Let’s take a look at the numbers:
Currently, there are between 18,000 and 30,000 foreclosure filings each month across the country. That translates to 300 to 600 potential short sale deals per state per month. Yet, despite the numbers, very few investors are reaching out to offer solutions through short sales.
For investors looking for untapped opportunities, this presents a golden chance to enter a less crowded market and uncover deals that others are missing.
The Profit Potential of Short Sales
When it comes to profit margins, short sales can be highly lucrative. For example, David Randolph, a short sale expert and our guest speaker at the October MAREI Meeting, reports earning between $50,000 and $150,000 per deal. The lower end typically comes from short sales he wholesales, while the higher end represents those he rehabs and resells.
David isn’t the only one seeing these results—his students are also achieving similar profits. This makes short sales a potentially profitable niche for both new and experienced real estate investors.
Why Now Is the Time for Short Sales
While short sales were once seen as a tedious and complicated process, today they offer a streamlined opportunity for those who take the time to learn the ropes. Investors who tap into this niche can secure properties at a discount and resell them for substantial profits, often with far less competition than in traditional real estate markets.
For those who are tired of being just one of many investors targeting absentee, vacant, probate, or distressed sellers, short sales present a chance to stand out. With larger profits and less competition, this is an opportunity worth exploring.
Join Us for the October MAREI Meeting
At the October MAREI Meeting on Tuesday, October 8th, David Randolph will be presenting his proven strategies for finding and negotiating short sales, as well as the latest real estate market trends. This meeting is a must for investors looking to unlock the potential of short sales and gain a competitive edge.
Event Agenda:
- 6:00 PM: Networking & Vendor Trade Show
- 7:00 PM: Buy, Sell, Trade Session
- 7:30 PM: David Randolph’s Presentation
MAREI members and first-time guests attend free. Non-members can join for $25/month or attend for $35. Can’t make it in person? The event will be recorded and made available to all MAREI members.
