I got a panicky email from another real estate agent this week, very upset that she had spotted a HUD foreclosure in her neighborhood.

She was mad.  Mainly because it is priced so far below market. 

A little background...I sold her the house she lives in and she got into real estate after some cajoling from me that she would be great.  She's a very smart agent (although not responding to my AR invitations, alas!), and will be quite good as she learns.

What was my response? 

     "Why are you mad?  Buy it yourself!"

One of the perks of real estate is that we have a unique opportunity to invest in real estate properly, using our knowledge of the local market and using the commission dollars we would earn to increase our spread.  However, many (dare I say most?) agents don't invest in real estate, too scared of the extra mortgages and risks entailed.

When you spot a foreclosure in your neighborhood-and the price is below market and the condition is, well, no different than resale, why not buy it yourself?  Flip it, if you don't have the gumption to be a landlord, or rent it if you do. 

If you're NOT an agent, and spot that same foreclosure-BUY IT.  Call your local real estate expert and run some numbers.  You might find that a better return awaits you on that house, than you're currently making in money market.  (***Just don't expect those crazy returns you see on HGTV flipping shows.  Think in moderation and ask your Realtor for pricing guidance.***)

And FYI-the first ten days a HUD property is available?  It's only available to owner-occupants.  Plan accordingly and reap the benefits.

(on this particular property, I've got a nice young couple bidding on it, and hoping we have the high bid at the deadline on Christmas Day!)