Have you ever been driving through your neighborhood and noticed a property that looked like it needed some work? Perhaps the fence had some pickets missing. The garage door could use a new coat of paint. Maybe the grass was three weeks past being mowed. Newspapers were accumulating in the driveway. Multiple pizza flyers were rubber-banded to the handle of the front door. Is this a property wherein the owners have no pride of ownership? Is the property owner’s lawn mower in the repair shop? Is this a property of owners who went on a vacation and forgot to stop the newspaper? Do these property owners never go in and out the front door? Or is this a property that has been abandoned by the owners? Your curiosity gets the better of you. You decide to watch the property to see if anyone is coming or going. You see no signs of human activity. You drive by at night to see if there are any lights on. The property is always dark. One day you decide to stop and ring the doorbell. No one answers. You notice the bird droppings on the front stoop from the nest in the entry eaves. Talk about disgusting. Why don’t the property owners clean up this mess? They are not around to notice. The property owners have walked away from their property.
Abandoned Property Every neighborhood in every city or town has abandoned property. These properties can be single-family residential, condominiums, duplexes, triplexes, fourplexes, apartments, commercial, industrial, business, hotels, resorts, farms, ranches, or vacant land. Any category of real estate you can think of contains abandoned property. Abandoned property can be found in big cities. Abandoned property can be found in rural areas. Abandoned property can be found in small towns. Abandoned property can be found along the coast. Abandoned property can be found in the mountains. You can find abandoned property anywhere.
Physical Condition An abandoned property can be in distressed condition. Abandoned property can fit into a stereotype of a property that looks blighted or run-down. An abandoned property can be in a bad neighborhood. Abandoned property can be on the wrong side of the tracks. An abandoned property can be in good condition. Abandoned property can be outside the stereotype and be in immaculate condition. An abandoned property can be in a good neighborhood. Abandoned property can be on the right side of the tracks.
Title Condition An abandoned property can be about to go into foreclosure. Abandoned property can be in foreclosure. An abandoned property can have unpaid property taxes. Abandoned property can have federal tax liens, state tax liens, and judgment liens against the title. An abandoned property can have loans that are in good standing. Abandoned property can have property taxes that are paid current. An abandoned property can have no tax liens or judgment liens against the title. In fact, abandoned property can have completely clear title.
Ownership The property owners of abandoned property are individuals, families, general partnerships, limited partnerships, family partnerships, corporations, trusts, small businesses, big businesses, local, state, and national governments. The abandoned property owners can be local to the community, live in the next town, live out of state or out of the country. Abandoned-property owners can be banks, mutual funds, stock cooperatives, local property-taxing authorities, foreign investors, the Internal Revenue Service, nonprofit organizations, churches, synagogues, mosques. Any entity you can think of can be an abandoned-property owner. An abandoned-property owner can be a celebrity or a nobody. An abandoned-property owner can be a royal or a commoner. An abandoned-property owner can be a legal business entity or an illegal business entity.
Financial Abandoned-property owners are poor. Abandoned-property owners are rich. Abandoned-property owners are everything in between rich and poor. The owners of abandoned property can fit into a stereotype of being financially strapped or even destitute. The abandoned-property owner can be in bankruptcy or about to be in bankruptcy. An abandoned-property owner can also be completely outside the stereotype and be quite well off financially.
Beyond the Stereotype Our point is that we want you to expand beyond your stereotypical sensibilities when it comes to finding and buying abandoned property. Yes, we agree that your initial notion of what an abandoned property would look like and who an abandoned-property owner would be is a good starting point for your investing in abandoned property. That is why we started this chapter out the way we did. However, an abandoned property can feel and seem like a normal property and look like other normal properties in the area. An abandoned property can even have someone living in it! How does that expand you beyond your stereotypical sensibilities?
Sixth Sense We also want you to develop an abandoned-property sixth sense. This will allow you to find and buy abandoned property that other real estate investors never identified as abandoned property. Because the abandoned property was outside of their stereotypical sensibilities, your potential competition becomes no competition for you! This sixth sense is like the sixth sense we want you to develop in our book Make Money in Short-Sale Foreclosures ( John Wiley & Sons, 2006). In that book, we show you how to identify short-sale foreclosure opportunities with property that does not fit the stereotypical real estate foreclosure investor’s sensibilities. You will develop this sixth sense in the abandoned- property arena by reading this book.
Undiscovered Gold Mine The first prospectors in California in the 1840s were ahead of their time. Very few people had the dream or the vision to pan for gold in the streams and creeks of the foothills of the Sierra Nevadas on the east side of San Francisco Bay. The work could be lonely, difficult, and the object of ridicule by people in the know who knew that the prospectors were wasting their time. In 1849, gold was discovered at Sutter’s Mill. This was the beginning of the California gold rush. It turned out that there was gold in them thar’ hills! Today, the professional football team in San Francisco is called the San Francisco 49ers in recognition of those prospectors, known as forty-niners, who put San Francisco on the map. Needless to say, the prospectors who staked out their claims early were the ones who were more likely to strike it rich. Abandoned property is the undiscovered real estate investment gold mine of the next three to five years. Just as the gold in California was already there waiting to be discovered, abandoned property is already there in your area waiting to be discovered. And who better to discover it than you?
Real Estate People in the Know Real estate people in the know have yet to put their seal of approval on abandoned property as a legitimate real estate investment opportunity. They are waiting for the news media to announce there is an abandoned-property market. That is the good news for you and us. For those of us who can see the abandoned-property opportunity, we will be able to stake our claim now. We will be more likely to strike it rich than those who jump on the abandoned-property bandwagon in the years to come. This will be long after we have discovered gold
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