The HUD List – What Happened?

In 1999 and 2000, the good old days. You can login to the HUD list. Identifies a property. Let it sit and eventually buy it at the price you want (sometimes 90 days later) unless Peter or Investors Network bought it first.

What happened?

The market is what happened. Our sleepy little town grew. Back then, the investment market was well defined. I stay in East Ft Myers Mainly, I did 3 deals in San Carlos and 3 in Lehigh but somehow I couldn’t get out of East Ft Myers, Peter stayed in Lehigh, the investor network dabbled in both. So all of you came! LOL.

Don’t get me wrong, the HUD listing still has some deals. But, you can’t live on that anymore. Here are some facts about HUD properties. HUD will accept 0.87 of the list price plus you must add commission. The current property is going for 100 of the list price and more. One of the main factors for that is that real estate agents have discovered that they can get a 5% commission on these offers. Another nice thing about the HUD listing is that you can include closing costs on top of the deal without having to educate the seller and their realtor (sometimes yours too!) that you’re not cutting your net, just reducing your cash to close.

As soon as the HUD listing hit the mainstream, we missed our gravy train. Another factor that contributed to this is the pre-foreclosure market and the courthouse steps that are so active. By the time HUD gets the property, it’s already been picked up pretty well.

So, this brings us to what role does the HUD List have now? It is a great place for new investors with decent credit to invest in their primary residence. You can buy an owner-occupied HUD home once every two years. Then trade when your two years are up. You could build a decent portfolio that way without a lot of money for down payments. With verifiable income and a 580 credit score, you can get a 100 LTV loan on a primary residence. So you could buy some properties in a couple of years in nice areas.