Here’s a trick you can use to find a house for sale that would be a good deal. It’s not that they’re not houses for sale right now, there’s a lot more inventory available than there was even a year year and a half ago, but a lot of these houses are still priced pretty high aren’t they?
The prices are coming down a little bit but they’re still through the roof. So how can you find a house that is priced reasonably? Not just find any old house but you want to find what you can get a deal on. Well, let’s first look at why houses are priced at the height that they are. Well, it’s because the people who are living in that house have a 2 or 3% mortgage and if they sell that house they’re going to have to go out and get a 7% mortgage on whatever they buy. Even if they buy the same priced house that they had.
Let’s say it’s a $400,000 house and they go from a 3% mortgage to a 7% mortgage. Well, that’s 4% more interest they pay every year. That’s $16,000 a year more than a thousand dollars a month. That’s like $1,200 a month more just to buy the same house. So guess who’s going to pay for that? You are because they’re not going to sell that house unless they make enough profit to pay their new mortgage rate of 7%. That’s why the houses aren’t coming down too much in price and they’re really not selling.
So what do you do to find somebody who has a higher mortgage? You can go into the land records in your state and you can find mortgages that were issued more than seven or eight years ago. If you find mortgages from 2000-2012, those mortgages were 6 or 7% and the person has paid down a lot more than somebody who refinanced in 2019. So if you go into the land records, and find homes that are financed less recently, those people you can see right on the paperwork what the rate is those people have rates in the 5 or 6% range. They don’t really care if they sell their house and they get a 7% mortgage it’s about what they’re paying now. Plus they have a big profit. Those are the houses to target. You can match up that list with what you see on Zillow. You can match up that list with maybe even sending out postcards to people Hey you want to sell your house? I want to buy your house. Those people are more willing to move because they’re not going to save that much. They’re not going to spend that much more on the interest rates which means they don’t have to pass that cost along to you.