Foreclosures in Windsor Ontario - A Formula

At current times - finding a foreclosure in Windsor might be easy to find. But if you’re in the market either as an real estate investor or a home buyer looking for a steal – be warned that there are great deals to be found, but just because the home is a power of sale – doesn’t equal a money making investment!

As a Realtor and investor myself – I follow a pretty simple formula;

• First research what the house will sell for when all updates and upgrades are done using a worst case scenario value.
• Next subtract all costs of renovations, updates and upgrades (Material and Labour) – again using a worst case scenario (what is the highest you will spend).
• Next subtract all carrying costs – these can include utility bills, insurance, interest on loans and multiply this on the months you are going to be working on the house plus the months it takes to sell.
• Next Subtract closing costs – which include lawyer’s fees when you buy and sell the property, along with Real Estate Fees and commission when you sell the house.
• Finally – you need to now subtract what you wanting to make Profit – the reason you are taking on this challenge – are you looking for modest returns on your time and investment – large returns – this value is up to you – though the larger the return the tougher it may be to find the investment – though with patience and research large returns can be found.
• With all this information – you are now left with the max price you are willing to pay for the house in question.

Ex: $120,000 -$15,000 -$3,000 -$9,000 -$15,000 = $76,000

(Worst Case Sale $) (Reno $) (Carrying $) (Closing $) (Profit $) (Max Offer)

If you’re buying the home as an investment or for your future castle - It is always important to do your due diligence when going after foreclosed homes. With being a strong competition of investors in the region, it is also important to get all your financing in order – and if possible inspections in order prior to the offer. When trying to get the lowest price on a purchase it may help to give offers with only one condition – buyer agrees to pay the balance of the purchase price – as well as a quick close. Though this is not always the case, it cannot hurt as it makes your offer stronger in the seller’s eyes.

Now if you’re buying the home to live in – the formula might be a little different, as the concern for profit won’t be as high –as you are purchasing the home to remodel to live in, more emotion is involved. When competing with an investor – you should win every time as the concern for profit is nominal you will be willing to outbid your potential investor competition.

If buying foreclosed homes in Windsor Essex County is something that catches your attention – I suggest you contact Warren Rutgers for more information on how you can get all foreclosure listings sent right to your inbox – best of luck!