Should I avoid heavily foreclosed areas?

I am looking to buy my first investment property, and my realtor recommends i look at areas that do not have too many foreclosures. How will this affect the price I pay and if my property appreciates in value?

Should I avoid heavily foreclosed areas?
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3 Replies to “Should I avoid heavily foreclosed areas?”

  1. When you are buying investment properties, the best deals are the under-valued houses. If you intend to hold these properties, the house market will probably improve and the value of such houses in foreclose neighborhoods should eventually go up.

    I would look more in the depressed neighborhoods (as long as they are not war zones); that’s where the best deals are.

  2. BY being in a high foreclosure area the prices will be more flexible and usually CHEAPER so I would be looking to STEAL a home as cheap as possible and then wait till the good times come back. They will come back!!!

  3. Your realtor may be more worried about his commission level, rather than your ability to realize a profit. Not all foreclosures are in run-down seedy areas, but clustered together is a bad sign for the neighborhood you may looking in, for a investment. Check the areas yourself to get a feel for the value of the houses in each neighborhood. Look for Middle class indicators – tidy lawn, not too many Chain link fences, Flags flying. Good Luck!

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