Successful Real Estate Investor explains how to find and purchase Preforeclosure & Foreclosure homes

Lucelia Chou of Novarise shares her keys to investing in real estate, including researching online, taking virtual tours on Google Maps, and using Foreclosure.com to compare properties.
Investors in real estate should assess the availability of employment opportunities in areas of interest to mitigate risks and maximize returns in the absence of job prospects, which can negatively impact the value of investments. A diverse range of employment opportunities in nearby towns strengthens investor confidence.
Foreclosure.com is a comprehensive directory of available homes in pre-foreclosure, auction, or foreclosure, offering a range of features that provide valuable insights for investors. These features include access to contact information for the realtor and owner, detailed information on comparable homes, and a range of tools to help evaluate investment opportunities. By leveraging these components, investors can make informed decisions that maximize return while minimizing risk.

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Foreclosure homes in Galveston, TX

More information about Lucelia Chou with Novarise  

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Transcript

0:00 - TJones - Welcome to foreclosure.com. My name is Tim Jones, and I'm excited to introduce our special guest and real estate investor, Lucilia Chow, with NovaRise. Lucilia. Thank you for speaking with me today.

0:12 - LChou - Hi, Tim. Thank you for having me. It's a pleasure and an honor.

0:16 - TJones - Well, let's jump into today's topic. How do you perform market research into the areas you want to invest in?

0:24 - LChou - Well, I basically start my search through Google, and I do a little bit of research on Zillow just to kind of get an idea what areas sparked my interest. And I like to first look at the type of houses that are available in the market, and then I tend to leverage Google Maps to do a little bit of like a digital tour, so to speak. So that way I can actually travel on to the area without necessarily having to leave my home. If I see something that interests me, then that's when I start diving deeper, and I leverage other tools, including foreclosure.com, to get a better grasp as to what's happening in the area.

1:07 - TJones - That's great. So, what are some essential factors to consider when thinking about risk?

1:15 - LChou - For me personally, the major risk factor that I look into is job availability because you can have the best homes available. The newest constructions, but if there aren't people with jobs that can bring in salary and afford to live there, then whatever you invest in becomes a ghost city or a ghost town because there's no income coming in and therefore no one is either gonna buy your properties or to even rent that out. So you're kind of stuck with inventory that it's impossible to move. So jobs are the biggest major. That's the number one priority for me, like I check into that first. When I check into jobs, I don't search just in the specific area that I am planning to invest in, but I also search about what other jobs are available within the vicinity. So, like, if, for whatever reason, the local economy doesn't do so good where the houses are in. Can they drive a half hour out or like 45 minutes or even an hour outside of the town on to the next town. And if the nearby towns do have job diversity job availability, then it makes the case stronger for you to feel confident that, hey, we're onto the right path here.

2:39 - TJones - No, that, that makes sense. Ok. So, how do you utilize foreclosure.com to get more visibility into the market you want to invest in?

2:48 - LChou - So I first go into the page, and I pick areas that I'm interested in, and then as soon as I go into that specific area, let's say, I don't know, I'm just going to throw a name out there like Galveston, Texas, right? I want to see what's making up Galveston. Like the number of pre-foreclosures available, the number of houses and auctions, and how many of those are in foreclosure available. So I tend to want to compare the numbers because depending on what's happening, that will basically tell me a certain story that I want to know. Like, why are these numbers of pre-foreclosure a lot higher than the number of foreclosures? Is it because the underwriting was not done properly, or is it because the, I don't know, a big factory just left town, and a lot of people are actually falling behind on their mortgages and stuff like that. So, each state tells you a different story. Usually, in my experience, on the pre-foreclosure side, people still have that opportunity to pick the payments back up if they manage to replace their lost income, whether it's through a loss of job or a divorce. But then, if you start seeing a lot of houses in the foreclosure state, then that, to me, that's kind of like a red flag as to what's going on in the area. It doesn't necessarily mean that it's a bad area to invest in, but like it will spike, you know, more interest in me as to, hey, do I need to do this in research to try to understand what is going on as to why are the houses going from pre-foreclosure to the foreclosure state. Because even going through the whole timeline of foreclosures for a family or a home to end up in foreclosure, a couple of months had to have gone by that, they couldn't really find a solution. So when I leverage tools like foreclosure.com, it allows me to kind of like depict the story, put a story back together. And aside from that, it also allows me to get access to comparables. There is a feature in the tool that shows home values for those who are looking to buy, and then it shows the median, meaning like the average of the pricing fluctuations over the past couple of months. And then it also tells me, on average, how much would a house like that or within that neighborhood go for if I decide to rent it out. And if we want to get even more technical, there's an additional side where you can actually click on a map, and it shows you the surroundings of the house. So, let's say I'm picking a house in Galveston. I have the option to look at a map, and it will show you all the comparables of the other houses in the area, how much they were, what they're sold for, and how much they are going for right now. And, it actually, it, it sort of works like a shortcut. So, instead of me having to go into other websites to try to figure out what the comparables are in the area, it turns out that the foreclosure.com tool already has all that built in for you. So it saves a lot of time and effort as well and not having to look elsewhere for the same information.

6:03 - TJones - Oh, that, that no, that makes perfect sense. And I can imagine job availability being extremely important when you're doing any market research. You kind of touched on this, But what specific tools do you use on foreclosure.com to buy pre-foreclosures and foreclosures?

6:23 - LChou - So when I go into the site, if I am interested in a particular area as soon as they click on the map, there is kind of like like a directory, I think that will be the best word that I can think of and where it shows you the number of available houses that are in pre-foreclosure or an auction or in a foreclosure state. And then, you can actually click on each of those categories and it will show you an additional listing of available homes within that category, whether there is an auction or foreclosure, pre-foreclosure, whichever category you are interested in. And then once you click on that category, then a new list will open up showing all the different addresses and all the different homes, the type of homes that you're interested in. And then, every time you click on that house, there's plenty of information for you to learn about that house. Like what's the story behind it? How many processes or stages, how many months has it been in the market? What is there to know in terms of pricing? So everything just happens to be within the same website. So, for the most part, I get, I will say, most of my information out of that one click, and it will tell me everything I need to know. And then, if I need additional information, I could corroborate that by searching into Google Maps. But more often than not, I don't do that. What I tend to prefer to do is to go straight to where it says contact information, and then I contact the realtor. And typically, in my experience with realtors, they are great at giving you market information because they're local, they understand their market, and also they want to make a sale. So they will not hesitate to bombard you with everything you need. So, one advice that I always like to give people is that when you get in touch with your realtor, don't be afraid to ask questions. And there's no such thing as a dumb question. Because they're there to help you, the more they get to educate you, the more they're helping you to make an informed decision. So, rather than having to go elsewhere and scavenge and try to find the information, hey, how do I contact the owner of this house? That information is usually available on the site, whether it's through a realtor or, a bank, or a courthouse, depending on the state of where the house is.  You can actually learn a lot by just leveraging the contact information that is already on the website.

9:03 - TJones - That's some terrific advice, Lucilia. Thank you for sharing how you utilize foreclosure.com. Well, that's all the time we have for today. I want to take this opportunity to thank you again for joining us. So, thank you again, Lucilia.

9:18 - LChou - Thank you so much for inviting me. It's been a pleasure and an honor as well. Thank you for the opportunity.

9:25 - TJones - it's our pleasure to have you, and we look forward to having you again in the future. Don't forget to sign up for our free foreclosure email alerts until next time. I'm Tim Jones, and thank you for watching.