Competition for foreclosures would come from speculative investors looking to receive deep discounts on large groups of foreclosed properties. These speculative investors would look to purchase properties in cash and make minimum repairs to the property in order to turn them over for quick profits, usually to another investor or individuals interested in maintaining the property to maximize profits. Speculative investors purchase properties at the lowest possible prices, as much as $0.40 on the dollar, in order to “flip” or turn a quick profit and only accounting for maximizing profits in the process.
Other potential sectors of competition would consist of investors looking for an incomegenerating property or individuals interested in purchasing a second home.
Since foreclosures have become a problem throughout markets across the nation, federal, state, and local governments, along with non-profit community based organizations, are trying to develop programs to stabilize foreclosures.
Many non-profits, because of their socially driven mission, have picked up the effort to develop programs aimed at resolving this problem. Some nonprofit programs are aimed at foreclosure counseling for households in danger of losing their homes and others are looking to purchase foreclosed homes. Many of these programs are available while some are still in the beginning stages. Non-profits that are interested in purchasing foreclosed properties generally do not have enough capital to purchase many of these properties at their current prices, leaving many of the foreclosed homes to be purchased by speculative