If you’re driving for dollars, chances are you have your own list of signs that a property may be distressed.

But if you’re just starting out, what exactly should you look for?

In this guide, we’re going to dive into some common signs a property may be a good fit to add in Prop360, as well as some notes for each. So let’s dive right in!

signs of distressed property

Distressed property like the image above can show several warning signs, some of which require a keen eye.

Analyzing the Exterior

Since you’ll just be driving by, you likely won’t have time (or the opportunity) to analyze the interior of a property.

You’ll need to make an educated guess based on the exterior of the home.

As a result, you’ll have to look for some common warning signs of a distressed property. Here’s a few that are common.

As a bonus, all of these examples I found out in the wild, using Prop360’s Street View feature. This is proof to show there’s homes like this in every market!

Signs of Distressed Real Estate

1. Old Roofs

old roof example

An example of a worn roof on a cape cod-style home, which has been patched, rather than replaced. Other signs of more serious wear would include moss and mold.

Old roofs are a really common way to find distressed property. If a property owner isn’t taking care of the roof, or it’s patched up, there’s likely a lot of deferred maintenance in other areas of the home as well. This may signal a landlord that isn’t wanting to fully repair the property, or an owner that is letting their home fall into disrepair for one reason or another.

2. Yard in Poor Condition / Heavy Overgrowth

Tall grass, lots of weeds, ivy or branches are another example of a property that may be distressed. Oftentimes, the weeds and branches may be so heavy that they’re covering much of the entrance to the home. This may be a good sign that the property is distressed.

3. Exterior in Poor Condition

property with aging exterior

Some properties may show a bit of an aging exterior, like this one. It could be because the property is abandoned or an out-of-state owner does not have the time to care for it.

If general aspects of the exterior are in poor condition, such as exterior paint, moldy siding, or gutters falling off, chances are you’ve found a distressed property. This one might be worth a closer look.

4. Broken or Old Windows

Take a look at the windows of the property. How old are they? Are the exteriors rotting? How about broken windows? All of these may be signs of a distressed property.

5. Cars / Junk / Trash Outside

If the home has cars parked in the front yard, junk in the front yard or covering the porch, or just lots of random objects outside, it may be a distressed property.

Check the porch as well. Some homes have good lawns, but trash covering the front porch. This can still be a warning sign of a distressed property.

6. Old AC Units

How old are the window units? Relatively old? Rusty? If the window units haven’t been replaced in awhile, this is another aspect of deferred maintenance. A landlord or property owner may be avoiding servicing these, which could be a sign that other areas of the home need work as well.

Additionally, by having window units, the owner is likely making a statement that they’d like to avoid paying for central AC. Since a central AC system generally runs about $5,000, depending on the area, this could be yet another sign of deferred maintenance.

7. Broken Fences

If the fences outside are extremely old, broken, or falling down, this is another area to look at.

8. Dated Exteriors

If the home you’re looking at has a dated exterior and doesn’t look well kept, it may be a sign that major repairs have been skipped on the property.

9. Damaged Gutters

If the gutters aren’t routed together, are falling off, or even don’t exist, this is generally another sign of deferred maintenance.

10. Notices on Door

notices on door

Notices on a property’s door often mean the property has code violations of some sort. These properties are often vacant.

Notices on the front door can mean some serious issues for a property – from code violations to eviction notices. We mail almost every home we see with a county notice on the front door.

Often you’ll see homes with multiple notices. These can be some of the largest opportunities in terms of distressed property.

11. Boarded Up Doors / Windows

boarded up property

A property could be boarded up for a variety of reasons, from code violations to back taxes.

This likely signals a vacant property that requires some pretty hefty maintenance. Additionally, it could have code violations or be an auction property. Be sure to check out owner info in Prop360 to see if it’s county-owned or absentee-owned.

12. Piles of Mail / Newspapers

This is a really good sign that the property is vacant and/or distressed. Check the mailbox and porch. Are there piles of mail or newspapers that clearly have been sitting for awhile? You’ve likely found a vacant property.

13. Deferred Maintenance

Other signs of deferred maintenance, such as tarps on a roof, or general issues with the property that could be easily solved but aren’t are good signs that this house may be worth looking into.

14. Fire Damage

If the house has a burnt area, it’s probably had some fire damage that needs repairs. Fire homes can be good properties if purchased right.

15. Structural Damage

Look for cracks in the foundation and porch. Are there pretty deep cracks? Is the home slanted in any way?

While foundation repairs can get pricey fast, these can still be good distressed homes to look into.

16. Lights

Are the exterior or interior lights on at night? If not, the home may be vacant.

17. Accessibility Ramps

Accessibility ramps are evidence of an aging owner.

Oftentimes, aging owners may not reside in their home anymore, due to having to move into assisted living, etc.

As a result, their homes may have other signs of distress that turns them away from selling on the MLS.

These may be good leads to pick up as well.

Setting Standards

When driving, either in person with the Prop360 Mobile App or via Street View Mode, you’ll often notice condition of homes can vary dramatically from town to town, neighborhood to neighborhood, and even street by street.

It’s up to you as an investor to determine what type of property stands out from the rest. Ideally, you’ll want to identify properties that are looking a bit worse for wear compared to other properties around them.

These are the properties that likely have absentee owners, or are vacant properties of some form or another.

Contacting the Owner the Right Way

Now that you’ve found some good properties to contact, it’s important that you do so the right way.

You don’t want to bother the owner too much if they’re not interested in selling.

At the same time, you do want to let the owner know that you are buying in the area, and you make it easy to close.

Owners can change their mind at any time, so it’s important to stay top of mind as being an option to sell their home, without being annoying.

We recommend using the direct mail feature in Prop360 to mail owners. Alternatively, you can also use phone or email skip tracing in the app – just keep in mind that most leads will not want to sell immediately.

Direct mail will allow you to mail them over time, so when the time comes to sell, they’ll know who to call.

Wrapping Up

In short, finding distressed properties becomes quite easy once you’ve done it for awhile. It only takes a couple hours or so to really get a feel for scouting the right ones out.

All of the examples above were found within a 10-minute time frame using the Prop360 Web App’s Street View feature.

With the right tool set, you’ll be finding some great properties in no time. Try out Prop360 for free – and let us know if there’s anything you’d like to see added!