Real estate investors look to profit off Houston’s flooded homes

Real estate investor Ray Sasser has an idea for how to make a buck off the damage Hurricane Harvey wrought on Houston.

Sasser, who has been buying Houston homes for 35 years, sees potential in the city’s flooded homes. His strategy, based on his experience after Tropical Storm Allison in 2001, is to buy about 50 damaged homes at discounted prices, fix them and then sell for a “hefty profit,” according to Reuters.

He presented the get-rich-quick strategy earlier this month to an audience of about 100 investors at the Realty Investment Club of Houston. Sasser explained to the crowd how the strategy worked in 2001: the damage knocked house prices down by up to 40 percent compared to before the storm, while repairs only cost about 15 percent. Roughly a year later, he sold the homes for their full pre-storm value.

Houston brokerage Redfin confirmed that investors are following Sasser’s strategy, whether they heard it from him or have devised a similar plan on their own. Redfin’s agents reported getting four times more calls from investors after Harvey and noted the investors were interested in buying damaged homes.

“They want to go in, pay cash, get the discount and fix it up to sell,” said Tara Waggoner, Redfin’s Houston market manager, to Reuters just after Harvey.

[Reuters] — E.K. Hudson