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Commercial PropertyOverseas PropertyPropertyProperty Investment

What is a Below Market Value Lead in Property?


To put it simply, a BMV, or below market value property is a property owned by a distressed seller. A distressed seller is a homeowner who, for whatever reason, has fallen behind on their mortgage payments and is imminently facing repossession. Distressed sellers are also sometimes known as motivated sellers as they are typically willing to do whatever it takes to sell their property, even if for a loss, in order to avoid repossession or short selling to their lenders.

In order for an investor to make a profit in the BMV niche, two pieces must come together, the initial purchase discount and the potential selling price of the property.

The current economic climate has placed many homeowners in a distressed situation, which has opened up a whole new opportunity for investors looking to make their mark in the property investment industry, while helping people at the same time. The problem is trying to find the properties to purchase. This is where BMV lead services come into play.

What are the Primary Reasons to go for Below Market Value Leads?

Investors who are prudent in finding good below market value leads are generally rewarded highly for their efforts. The possible rewards for an investor through any such deal include:
1. Immediate equity in the property purchased
2. Prospects of appreciation of investment. Historically, property prices increase by 100% every seven years.
3. Rental income is the gain following mortgage payments.
4. Cash back on the completion of the deal, if the initial purchase discount is sufficiently large.

How to Find Below Market Value (BMV) Leads:
The most crucial aspect of entering the below market value property market is understanding that it is not so much about the property as it is about the people. A BMV deal is completely dependant on finding distressed people in need of the investor’s services and the investor’s skill at negotiating a good deal for both parties involved.

In essence, the seller has a problem and you have the solution, however, more often than not, it is difficult to link distressed sellers with investors due, in part, to a large population of scam artists trying to make money from desperate people. As is the case with any deal, you would always prefer to have dealings from people whom you can trust or people you are acquainted with. Therefore, it is very important that you, as a BMV property investor, have access to valid property listings or below market value leads.

In order to find distressed sellers, many investors go online and subscribe to a service that provides detailed property listings for distressed properties. Many of these database-type websites will include property listings, products and services providers’ listings and networking capabilities all in an effort to arm BMV investors with enough information to make intelligent decisions on which properties to invest in.

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