As a real estate investor, you’ve probably heard about the fruitful abandoned house market. Currently, there are over 16 million abandoned properties in America. These houses are usually cheaper, and you’ll have less competition.
Technically, property abandonment is a telltale sign of an economic downturn in cities and rural regions. But you’ll enter a whole new ballgame if you invest in a deserted house in the countryside. Many believe it could be a once-in-a-lifetime opportunity.
In this blog, we will discuss why real estate investors should buy abandoned property in the countryside, factors to consider, and more.
You should invest in rural abandoned properties because they can gradually generate substantial ROI. Why? Well, these houses usually come with beautiful land or acreage.
According to Land Broker Co-op, countryside homes with acreage have lower land prices and cleaner air. As a result, you or your clients will have more space for sustainable living practices.
Once renovated and improved, these properties can attract people looking to escape the fast-paced city. It can become a refuge for those who want a peaceful life away from noise and stress. Moreover, these houses have benefits like privacy, better gardening, and more.
It’s a good idea to find a home w/ acreage in rural areas through a broker. With their help, you can seamlessly invest in a deserted home and enter the rural real estate industry. But make sure to inform the broker about your needs and expectations.
After that, you can check these factors before buying the property:
- Compare the price of the property with similar ones
- Check the total area the land covers to determine its worth
- Inspect the pictures to see the extent of damage to the home
- Ask yourself if the house is worth anything based on its location, acreage, and size
Furthermore, you must research and inspect the location before investing. You can also talk to the bank that foreclosed it or the neighbors for more insight.
Buying a deserted house anywhere in the country will come with a straightforward list of pros and cons. Take a look at them and decide whether you’re up for the challenge or not.
Abandoned properties have a significantly low price tag due to the bad conditions they are in. That’s why they are sold at a lower market value. However, the need for repairs and high maintenance costs can make it a risky investment.
For instance, these properties can have overgrown vegetation on the acreage, unpaid taxes, and more. Buying a deserted house in the countryside means you must spend thousands of dollars on maintenance, code enforcement, and more.
The best thing about buying an abandoned house in the countryside is that nobody else would want to invest. Most investors shy away from these properties because the process of obtaining them can be complex and time-consuming. That means the competition for buying such properties with acreage is far less than buying newer houses.
However, obtaining a mortgage for such a house with acreage can be challenging. Even the buying process can take several months because of legal complications, depending on the circumstances of abandonment.
You can customize the deserted house and fix the acreage based on your personal viewpoint. After rebuilding, most turn it into a hotel or use it as a rental. Eventually, you can sell it at a higher market value due to the acreage and location and make a profit.
However, rebuilding the house and making it perfect will require extensive financing. Most lenders might be skeptical about helping you out. Therefore, you must be 100% sure about buying an abandoned property with acreage, as it requires financial backing, time, commitment, and patience.
Initially, deserted property has less value, making it seem unappealing to many buyers. However, investors like you can use it as a rehabilitation project to turn it into a livable home.
You can put it up on the market once you’ve rebuilt the abandoned house and made it look presentable. Doing so will affect the property’s value, eventually increasing the market price.
For example, three millennials bought an abandoned school building for USD 100,000 and turned it into a 31-unit residential apartment building. They now charge USD 1,400 for a one-bedroom apartment and USD 1,650 for a two-bedroom apartment.
This story proves that the possibilities are endless when you invest in deserted property. That means you can turn the countryside home with acreage into a hotel or sell it to your clients.