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Zombie properties are homes that have been visibly abandoned but actual ownership has not. The term became popular in the housing industry during the 2007-08 housing crisis when people being unable to make their mortgage payments reached a catastrophic point.
According to ATTOM Data Solutions, a firm that tracks different types of real estate data, zombie properties made up about 3% of all foreclosures in the U.S. in October 2019. These homes can be a good buy, but there are some challenges you should be aware of before signing on the dotted line.
A zombie property occurs when a homeowner is told they are being foreclosed upon, and they leave their home believing they must immediately vacate. The zombie scenario arises when a bank either abandons or inadvertently never completes the foreclosure process, and the house is left in limbo with no one caring for the property.
Zombie properties can be very lucrative investments because they are often able to be purchased at rock-bottom rates. The problem is there are some risks involved with buying this type of property because they’ve essentially been abandoned for often long periods of time which sets the condition for many unfortunate events to occur.
In many foreclosure situations, a home is already left in poor condition. In many cases, the homeowner couldn’t financially keep up with upkeep, or they’ve purposely destroyed the home before they left. Any of these problems or others are further exasperated in zombie situations because there is a high probability more destruction has been heaped up upon the original neglect or damage.
Once a house is recognized as a zombie property, squatters or vandals often decide the property is fair game. They might simply come inside to be destructive, or they may use it for their own purposes.
Additionally, if vandals or squatters leave doors or windows open, animals, including feral cats might have taken up residence.
Once a homeowner has abandoned a property, they can be difficult to locate. Some may have gone off the grid or others have no clue they are still listed on the property deed. The name of the previous occupant who owned the home will need to be removed from the title so this will be a legal detail to address before a purchase can move forward.
Purchasing a zombie property can be a very lucrative investment, but it’s essential to carefully evaluate the condition of the property before deciding to buy it. You might find the effort and expense involved in bringing it up to be habitable might be more than it’s worth.
I have been in the real estate industry for over 25 years! I started working with some of the top builders in Tampa and then decided to pursue my general real estate license. I love working with people and helping them find the home of their dreams. The TampaBay Metro area(Tampa, St Petersburg, Clearwater...)is a great City and has grown unbelievably in the past 25+years. I have extensive knowledge that I can share for those coming to the Florida area or those who want to move up or downsize or have to leave our great state. I make it my goal to work for you to find the right home, whether it be upsizing or downsizing, I will find the best location for you! From the beaches to golf course to the city or country, I can find the perfect home for you! When you call my phone, you get ME! You are not handed off, if I don't know the answer to a question, I will find out and get back to you! I Work FOR YOU!!