How to Buy Options on Properties Destroyed by Natural and Man Made Disasters

First things first: You must be very careful when using this option strategy, so that you are not perceived as just another sleazy opportunist trying to take advantage of the plight of disaster victims. And this is why it is best that you never contact any property owners in disaster areas until after the dust has had a chance to settle. I am telling you this because after every man-made and natural disaster, there is always a segment of the population, especially in the areas that have been the hardest hit, who throw in the towel and take their insurance money and run. And property owners who have been reimbursed by their insurer for their loss but, for whatever reason, have no desire to rebuild are the owners who are most likely to sell an option to purchase their destroyed property. Savvy option investors can buy a one- to two-year option to purchase the property at a bargain price, clear away the rubble, and wait until the recovery is well underway, and then resell or exercise their option. Building lots with existing utility hookups appeal to home-builders because they are ready to build on and they avoid paying impact fees to local and state government agencies. This strategy has a lot of profit potential because of the lack of competition from other investors. I recommend that you use the following methods to locate property owners in disaster areas who would be willing to sell investors an option to buy their destroyed property:

1. Contact owners by handing out flyers because mail service may be interrupted for quite a while.

2. Place ads on billboards as the rates should be cheaper due to local economic conditions.

3. Buy radio and TV spot advertising.

4. Place classified ads in local newspapers.

-CHAPTER 7-

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