Tried to get our first lease option deal going, but the numbers just don’t look right. Is there something I’m missing here?
Market rent of half-plex $1000 -1200/month
Current tenant pays $1100
High-demand area, but in a declining market now
Seller asking $255k, comps are about 15-20k lower
Seller monthly payment is $1700/month, so he’s in $600 negative cash flow
Loan balance is $245k
Seller motivated but not desperate, wants to work with us is numbers can work out
I’ve racked my brains but can’t come up with a winning scenario here. Is this deal dead?