Seller owns the house free and clear, but does not want to sell until she is 55 in two years and in a better tax position.
The house needs all new floors, new roof, paint, backyard work. Bathroom and kitchen cabinets may do for a rental, but must go for a sale.
I am trying to push the idea of an seller installment sale, perhaps interest only with the note due in two years, where I can sell it or refi. In this way she would only have to incur taxes on the the current income and avoid capital gains. Because of the repairs needed I would make an offer of FMV reduced by the estimated costs of repairs.
If I paid interest only and the rent covered that plus property taxes, I would build equity from the appreciation, as long as prices turn around.
You’re buying at FMV in a falling market…where are you planning to make money? This is a retail deal, you can find lots of those that don’t include this many hassles by calling your local broker. Why in the world would you, an investor, do anything crazy like buy at FMV?
I would build equity from the appreciation, as long as prices turn around.
Most everyone I've heard from has said they expect the prices to fall for a while longer and historical data shows prices require at least a few years past the bottom to recover. Can you afford to hold it and pay the mortgage and expenses for a few years in HOPE that the market will bounce back? With lenders serverely curtailing their lending I don't expect prices to skyrocket again anytime soon as many of the people that were driving up prices couldn't get approved for a doublewide in the middle of the county landfill.
60-65% of FMV minus repairs and you’re talking about a better place to be.
:cool RICH is right as even if this was a good market you still are and would be paying way way to much for this may be head case of a house !! AS investor you should be paying no more than 50% of the after rehab value to see any money to speak of /// even if you had this on a note and wanted to sell the note// you would still have to have a apprasial done and the way it sounds it would come back as low low !!! WHEN i sell on a note or even buy on a note a apprasil comes in to play some where at the buy and sell SAY i buy and i get the home for 50 % of after rehab value fix it up and sell it on a note when i sell the note the max i can expect to get is *** 80% of the face of the note
I hope this has helped you out RUN RUN this is not a good buy in any way !!!