This is a difficult business to enter, even with these economic times. It is not impossible, just very, very tough. This type of work generally falls under the category of "Property Preservationists". If you Google search "Property Preservation" and/or "Field Services" you will see there are literally hundreds of companies out there providing this type of work. There are many very large companies that provide this type service and you will be competing heavily with them.
Your biggest hurdle would be marketing this service as you need to reach the REO departments for the banks handling these properties and also the RE Agencies handling the listings. The bank REO departments are difficult at times to locate and generally not interested in dealing with a company that provides only a limited amount of the services they need to handle an empty REO property. As for the REO listing agencies they have their preferred vendors already and also prefer to work with full service vendors.
You can sign up with these property preservation companies as a sub-contractor and perform some of the services they offer for the REO properties. However, don't expect to make any useful income from this unless you have many, many REO's in your immediate area, are ready to hustle, provide more services than what you are listing and are very organized. For example, a property condition report is just a quick walk around the property and take a few photos. For this the property preservation companies pay their subcontractors $10 - $15. If you have a lot of these all in one zip code, and on the same day, then you might make a few dollars off of it. If not then the time and gas alone would mean you lose considerably.
If you are going to run your own business then also be ready to be insured with both General Liability and potentially Errors and Omissions insurance. I know an individual in our area who performs property preservation as a full time business and services some accounts directly but most as a subcontractor. His E&O alone is $10,000 a year and his GL another $4000. Your costs might be different but your homes there are also a much higher value.
You mentioned providing detailed damage reports, photos, neighborhood conditions, etc. Quite frankly most banks don't particularly care about details. All they are interested in is securing the property, getting it listed and getting it sold. Unfortunately banks are generally not required to disclose any property defects and buyers are left completely on their own to ensure the condition of the property they are buying. As such the banks, nor the REO listing agencies, are interested in detailed reports of any type.
It's not impossible to break into this business, just very, very hard and will require a huge amount of marketing, time and potentially money. Good luck and make sure you research this heavily before expending money on equipment, insurances, etc.
Emmanuel J. Scanlan
PS Inspection & Property Services LLC
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