One of the many things I enjoy about the Real Estate business is that each property and loan scenario is unique. Real Estate is not a commodity as every property and borrower has different characteristics that impact value. A personal or trusted associate property visit before making a hard money loan always provides useful underwriting information and insights. This blog describes what to look for when visiting a property. Both positive and negative property characteristics can be determined by a drive by:
| Positive Observations: | Implication: |
| Toys on the lawn | Verification that a Tenant is leasing the house |
| Garden hose on the side of the house | The landlord/tenant/owner is watering the plants and taking care of the landscaping. |
| Welcome mat at front door | Pride of ownership by Tenant and Owner |
| Real Estate signs on the street | Many sale/lease signs signal a distressed neighborhood. |
| Paint and Roof in good condition | Property maintenance and capital improvements taking place |
| Observations that should cause Concern: | Implication: |
| High number of empty lots | Shows a neighborhood that may not be in demand |
| Vacant houses on the street | Developer may have badly overestimated demand and could soon be choking on inventory. Also could signal pending foreclosures. |
| Bars on Windows | Lack of security in the neighborhood |
| Real Estate signs on the street | Many sale/lease signs signal a distressed neighborhood. |
| Trash in the Streets on lawns | Neighborhood may be deteriorating |
Pictures on a website or GoogleMaps can be deceiving. Make sure you get a real person making a real drive by of a property before you lend on your next hard money loan. Mortgage Vintage, Inc. always makes some kind of property visit. Do you have any unique stories about a property visit?