The last several years have been hard on real estate investors. With property values going sky high and inventory being the lowest it’s been in a very long time, the “deals” literally dried up. It’s because of this that professional home buyers (a.k.a. real estate investors) have had to get creative, and creative they have indeed become. 

In the past, investors would simply canvas neighborhoods with flyers on door knobs, or they would put signs on corners announcing “We buy homes” or “We pay cash for houses.” These days investors are beginning to collaborate and cooperate, with some even franchising their proven systems for finding and securing the best deals.

One such well-known early franchise system you may recognize is “We Buy
Ugly Houses.” They did, in fact, tend to target houses that were otherwise hard to sell using traditional methods because they were in disrepair (a.k.a. ugly). Don’t get me wrong; they would happily buy a pretty home, too – for the right price. 

Since the ugly house guys, however, the investor market has set their sights on an even more specific niche – longtime homeowners relocating to senior living communities, assisted living, and long-term nursing care. Why do senior homeowners present such a robust market for home investors looking for deals? Below are just a few of the reasons: 

    1. Homeowners who have owned their property for decades may underestimate the current market value of their homes.

Unlike REALTORS ®, unlicensed investors do not have an ethical obligation to educate homeowners on the true value of their property. Investors may make offers that are lower than the true competitive market value, saying things like, “This is a competitive offer.”

Some longtime homeowners with no mortgage to pay off may view these offers positively. This can lead them to accept the offer without seeking a second opinion from a trusted source.

    2. Homeowners who are feeling overwhelmed by the process of
selling a home and liquidating remaining items may be susceptible to both founded and unfounded offers of simplicity and convenience. 

As a perk to homeowners who are willing to sell at an extreme discount (often 25-50% less than the actual home value), investors may offer to manage the liquidation of remaining items in the home or allow the homeowner to live in the residence for minimal rent until they are able to liquidate their persona belongings.

Homeowners who are unaware of REALTORS with Move Management fairly priced support services may elect to sell at an extreme discount to avoid the hassle of doing it themselves or “bothering” their family
for help. 

    3. Seniors tend to trust people with titles despite proof of expertise or experience and, therefore may not check references. 

Creative investors have begun marketing themselves as “Senior Transition Specialists,” with some even purporting to be certified in this area. Claims of such credentials are often simply marketing techniques taught online or over a weekend in local hotel ballrooms full of eager newbie real estate investors.

There are legitimate trainings which require many hours and often months of education, reference and background checks, and testing; however, these professional home buyers have no such training. When asked about their certifying organization, they may share fictitious information or avoid the topic
altogether.

    4. Senior living communities, typically regarded as reliable sources for recommendations (and they usually are), may suggest investors as an option because they believe it will help their prospect with a swift and effortless move-in process.

Sadly, these “creative” investors are now marketing their services to senior living operators in order to connect with potential senior home sellers. They provide assurances to the referring community that they can assist them in getting people to move in faster by buying their home and emptying it quickly. By making contact before a real estate professional is involved, these investors are able to convince homeowners they are getting a “fair value” while saving a commission.

The offer of “fast cash” is appealing to those who may need the money to make the move and who are unaware of more reputable and less expensive ways to access their home equity and to simplify the relocation process. Senior community salespeople may be just as susceptible as seniors when it comes to believing the unfounded claims of certifications and training. They often fail to check references or to fully understand the predatory nature of some home-buying schemes.

    5. When people are stressed, grieving, tired, or recovering from illnesses, they are more vulnerable and thereby susceptible to unscrupulous, unethical, and predatory business practices. 

Sadly, we have all heard of someone who has been scammed by an unscrupulous business, organization, or con-artist. No one likes to admit it, but we are all at risk of such practices. The people leading these organizations often appear kind, empathic, and even charming. Their hidden motives, however, are anything but honest or fair. When making a major life change, such as moving from a longtime home or into a retirement community setting, stress is just a reality. Investors count on that stress and use it to their advantage.

Rather than encouraging you to get second opinions or have an advisor review their offer, they will encourage you to act quickly to get through the process as fast as possible. When you make fast decisions, you are less likely to see through their predatory and sometimes illegal tactics