Pre-foreclosures are usually considered to be properties that have a Notice of Default filed in any particular state. Banks use this opportunity to pre-sell the property in order to avoid losing total profit on that particular asset. In Dallas, pre-foreclosures are common with a skyrocketing tax rate and a continually lumping economy. Although Dallas’ market is certainly one of the better in the country, pre-foreclosure rates continue to climb while prospective homebuyers reap the reward.
In general, foreclosures are a costly proposition for lenders. In fact, foreclosures in the Dallas market cost the lenders, on average, close to $58,000 per foreclosure. Thus, offering pre-foreclosure deals in the form of short sales is the best avenue to go.
The rule of economics would dictate that when supply exceeds demand, prices drop and the consumers benefit. The property tax costs in the Dallas area are generally up to 13% lower than the national average. This percentage, of course, is an exceptional incentive to consider when purchasing a home in the Dallas area.
While some areas of the Dallas market are much higher in tax rates, still others fall well below the 13% below average market that falls even lower to 20%. Purchasing a pre-foreclosure home in the Dallas market can also serve as a solid investment opportunity.
The property’s value is well below market at this rate, allowing for the lender to attempt gaining back their costs and the purchaser saves money. Research suggests that Dallas is a desirable place to live by cost of living standards and many people have purchased Dallas pre-foreclosures as an investment on future profit. Selling a pre-foreclosure home is extremely beneficial as you are then able to sell the property at the market rate, gaining any costs associated with the purchase of the actual property.
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