One man's loss is another man's gain, they say, and in the current economic climate, repossessed homes are proving to be the silver lining in the dark cloud of global recession, offering canny investors properties at discounts of 30% to 60%.
In Florida, repossession bus tours are a regular occurrence through neighbourhoods crowded with empty houses. The internet is littered with listings of American properties in danger of foreclosure where owners have missed mortgage repayments.
And it's not just modest houses that are being repossessed and sold on. Last week the banks seized the London mansion of 38-year-old millionaire financier Robert Bonnier. When it comes on the market again, the asking price is expected to be considerably less than its current ¤15.2m price tag.
Distasteful as it may seem to profit from someone else's misfortune, the 'repo' industry is big business in the US, spawning hundreds of dedicated websites and specialist real estate agents. In fact one US real estate company, RealtyTrac, claims 17% of all its properties for sale are repossession homes.
The variety of companies dealing in this market is staggering. Greatpossibilities.com, Foreclosuredeals.com, Quickrepo.com, Splut.com and Repossession.com are just a few of the sites out there battling for business – much of which is now coming from Irish investors.
"We get emails from specialist agents in the US every single week looking for Irish clients who might be interested in buying repossessed property," says Michael Bolger, director of Empire Consulting, an Irish company which provides independent advice on international investment.
"Some people might not like the idea of buying repossessed property but in one sense you're getting someone else out of trouble, and some investors see themselves as the 'white knights' of the property market," says Bolger, who agrees that buying repossessed property can be quite lucrative.
Repossessed homes or homes undergoing foreclosure sell for much lower simply because banks are not estate agents and are not in the business of holding property, but simply want to off-load it and retrieve their portion of the debt.
In Brooklyn, New York, repossessed four-bed detached family homes are selling for as little as ¤88,450 at Foreclosuredeals.com, while in Manhattan two-bed apartments worth over ¤610,000 are selling for just ¤373,000.
The trend for buying repossessed homes isn't restricted to America either.
Irish property consultancy Locations.ie reports a lot of interest by Irish buyers lately in repossessed property in Spain.
"We currently have over 50 repossessions on our books around the Costa del Sol and another 30 around the Costa Blanca region with prices up to 30% lower than their current market value," says manger Stephen O'Grady.
In the UK, finding a repossessed home for sale can be tricky.
"Buying repossessed property in the UK isn't as easy as it might seem," says Henry Davis, of International Property, a UK commercial and residential investment company with offices in Dublin and Liverpool.
"The UK banks don't give out lists of homes that have been repossessed. They just hand them over to the auction houses, and the only way you would know the property was repossessed is because it would be listed as 'by order of the mortgagee'," explains Davis.
Some specialist agents in the UK, such as Assetz for Investors, offer a tailored 'distressed property' service whereby for a fee of around €3,736 plus VAT, they will source repossessed properties for clients at 30% reductions, and give a written guarantee of achievable rent. The company claim repossessed properties in Manchester worth ¤250,000, can be bought for around ¤190,000.
While 'repossession' has become a selling tactic, with both agents and investors cashing in, actually buying a repossessed home is not all plain sailing.
If you buy a repossessed home at auction you buy the property 'as is' which can mean taking a chance on its condition, and if you choose to buy at pre-foreclosure stage, you will have to source properties yourself from court lists. Some specialist agents will do this for a fee, but it can still be difficult to contact the owners. It's also important to remember to contact the bailiffs once you have purchased a repossessed home and tell them the property is under new ownership, and to ensure it's taken off their list.
The golden rule is always to find out why the property was repossessed. A home previously owned by a drug dealer could prove toxic in more ways than one. You also don't want to end up owning a bad home in a really bad neighbourhood; you may have got it for a bargain but you'll never be able to off-load it.
In the UK, 18,900 homes were repossessed in the first half of the year and housing charity Shelter expects that number to rise substantially when the end-of-year figures are released.
In the US, the situation is even worse with RealyTrac reporting that 343,159 Americans lost their homes in the first half of 2008, up 136% from 145,696 recorded during the same period in 2007.
In Ireland, repossession figures, although 100% up on last year, are less grim with just 108 homes repossessed in the first six months of this year. All Irish estate agents we contacted said the repossession market here is likely to remain insignificant. In other words, if you're hanging on for any mansions in Dublin 4 to be repossessed and put on the market for next to nothing, don't hold your breath!