Discover how to take advantage of U.S. short sales to instantly close hot deals with top ROI. 

There’s no doubt about it, the recent activity in U.S. housing markets is attracting more and more investors creating a competitive bidding environment. With all the influx of new investors, how do you break into the U.S. real estate market?

New data is showing a surge in U.S. real estate short sales.

Short sales can be a great way to purchase an undervalued property and with the new short sale rules implemented in November 2012. In the last 3 month, short sale transactions surged by 22%. 

This article shows you how to take advantage of short sales to close on top profit deals and what to avoid.

Are Short Sales Beneficial for the Buyer?

As a Canadian-based U.S. real estate investor, short sales (a.k.a. pre-foreclosures) can be an ideal way to capitalize on U.S. housing conditions. If you play your cards right, you should be able to generate rental income and benefit from long-term property appreciation.

What’s a short sale?

A short sale is basically a transaction where a homeowner who is in danger of default is able to get out of his troubled mortgage if approved for short sale process.

Rationale Behind the Short Sale

In a short sale transaction distressed property owners decide to sell the property at a value that is lower than what they owe their lending institution, the bank for their part agrees to absorb the loss. 

The bank then sells the property quickly while the property owner is freed of his responsibilities from a mortgage that he can no longer pay.

Red Flags to Avoid

Make sure there are no other outstanding liens on the property with a title deed insurance claim.  

Be prepared for a sensitive seller who may or may not be going through emotional turmoil over the deal.

How to Make Top ROI for Short Sale Assets

There are essentially two main paths you can choose to make money off your short sale property.

1) Set it up as a rental property
2) Renovate and flip for profits

In either case, it will depend on your budget and your housing location to determine what is the best strategy for you.

If you are going to renovate the property, be sure to stay within your budget – there’s nothing that hurts more than eating into your profits with renovations that don’t actually increase your returns.

Happy investing!