Distressed Property
A property in poor physical or financial condition — deferred maintenance, code violations, or looming default — that trades below market.
A distressed property is one under physical or financial strain: heavy deferred maintenance, fire or water damage, open code violations, or an owner sliding toward foreclosure. The distress depresses the price, which is exactly the discount an investor needs to fund repairs and still profit.
Distress and motivation often travel together but aren't the same thing — a beat-up house with a comfortable owner may not sell, while a clean house with a desperate owner will. The best leads sit where a distressed property meets a motivated seller.
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