The theme of “Make Money in Abandoned Properties” by Chantal Howell Carey and Bill Carey sounds unusual and enticing. But once the reader passes beyond the first few chapters about the characteristics of abandoned properties, the reality sets in that the methods are virtually the same as for buying foreclosure, fixer-upper and other distress properties.
“Owners abandon properties for three main reasons. These include financial reasons, death or divorce, and when the property becomes uninhabitable,” the authors explain. Sounds much like foreclosure property, doesn’t it?
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Especially valuable is the investment outlook of the Careys toward real estate. They say, “The truth be told, however, there is no real estate market. There are only people to talk to. We say it this way: contacts create contracts. Contact with people creates opportunity for you as a real estate investor. To be a successful real estate investor, you must talk to people.”
Later, they say, “There is no deal so good that you have to jump on it or it will disappear…There is no scarcity of good abandoned-property deals.” Although I don’t fully agree, understanding the attitude of the authors is worthwhile, as they explain their procedures for finding and buying abandoned properties.
The many examples throughout the book make it especially valuable from the viewpoint of knowing what to buy and what to avoid. Some techniques for finding the owners of abandoned real estate are somewhat unique — such as filing an “abandonment of property lawsuit” (which is really a quiet title lawsuit) — and seem outlandish, especially if the property owner counters with a malicious prosecution lawsuit.
Readers should be careful before applying some of the suggested methods. To illustrate, in some states offering an abandoned property owner who is in mortgage default a lease with option to buy the property back could be construed as a mortgage loan.
Although the Careys have written several superb real estate books, this is not one of them. Parts of this book are difficult or downright impossible to understand.
For example, in the chapter about quickly reselling properties the authors say: “One of the major advantages of the quick-cash strategy is you avoid income-tax problems. When you hold rental real estate, it is very easy to recapture depreciation when you sell the property. Currently, if you have recapture of depreciation you pay 25 percent in taxes. How easy is it to recapture depreciation? Just own rental real estate and take depreciation.” I think I know what they meant, but the real meaning didn’t come through.
Chapter topics include “What is Abandoned Property?” “Why Do Property Owners Walk Away”; “Motivated Abandoned Property Owners”; “How to Find Abandoned Property”; “How to Locate Owners Who Have Abandoned Their Property”; “How to Write a Foolproof Abandoned Property Offer”; “Counteroffers”; “Negotiating with the Abandoned Property Owner in Foreclosure”; “Buy the Abandoned Property First, Then Get a Buyer”; “Four Ways to Obtain Financing to Rehab or Hold Abandoned Property”; “Creative Financing of Abandoned Property”; “Assigning Your Abandoned Property Deals”; and “How to Find Motivated Partners.”
Much of this book has little to do with abandoned properties. But it’s still good reading for real estate investors who are creative and don’t mind working for profits. On my scale of one to 10, this disappointing new book rates an eight.
“Make Money in Abandoned Properties,” by Chantal Howell Carey and Bill Carey (John Wiley and Sons, Hoboken, NJ), 2006, $34.95; 234 pages; Available in stock or by special order at local bookstores, public libraries, and www.Amazon.com.
(For more information on Bob Bruss publications, visit his
Real Estate Center).
