There are many builders and real estate investors who are finding themselves in a difficult place.  The property that they were looking to make money on is in fact costing them money.  With higher than recent market times, some local builders and small time investors/flippers are choosing foreclosure as their best option.  The monthly carrying costs of a mortgage, interest, taxes, utilities, and maintenance are adding up and many are finding that even a break-even sale is going to be impossible.  Now their choices are to lose money or let the bank take over the property. 

Nobody wants to be foreclosed on, but for builders and investors it is a business decision and many are cutting their loses.  There is certainly an opportunity for home owners to strike a deal on these properties before foreclosure occurs.  They are difficult to locate but an experienced Realtor who knows the local market can certainly locate these gems.  The next hurdle is negotiating a price where the buyer gets a great deal and the builder or investor takes a minimal loss but is able to avoid foreclosure and keep a positive reputation.