SFH 3bd/2ba
FMV : $134K
SELL PRICE: $129K
EXISTING MORTGAGE: $35K
REPAIRS BY OWNER: $45K
*property owner lives in another city/ tired of leasing property/ doesn’t want to do a L/O
What are some options I can use concerning this property?
I am really not a fan of serendipitous deals. Stumbling onto a deal is like stumbling onto some cute chick. I may really like to look at her or something, but if she doesn’t fit my plan for my wife then I will pass on her. She is a distraction. While you are wining and dining her, you can’t find your true love. I don’t buy properties that don’t fit my business model either. This deal will eat your time and resources and prevent you from following your plan for the time you are dealing with it. What does a person in your town do with a house like that? There is some money in it from your description I would get the money out by buying it fixing it up and selling it. I would first buy it, evict the tenant fix it up and sell it.
If I’m reading it right they already made the the repairs?? It doesn’t sound like they are a very motivated seller with only a $5k discount. Would is cashflow as a rental? If you plan to flip it, then you need a much bigger discount.
The house is empty and the owner spent $45k in renovations.
There’s about a $50k spread in this property. I was just wondering if there was a way I could get some of the $50K spread? Thank you for your reply.
I would pick a good profit for the seller and offer him that. If he bites, then you have a deal.
It sounds like the property is already fixed up. If that is so remember you never want to buy the other man’s paint. That leaves you with that $5k spread you are battling.
If I made an offer of $95k this would be $15k or $20k above his costs. Does this sound feasible? I have all cash. I won’t use any financing. I thought about offering what the owner has in the property which is about $80k. What do you think? No work has to be done on the property.
You really have to determine the sellers motivation. He may not want to deal with it, but he may not be in any hurry to sell. He has put the work in so probably wants some sort of return. $95 sounds fair, that is just above 70% LTV. Can you justify that to the seller? Like you intend to rent it out and the only way it will cashflow for you is if you do not exceed that price… Then again he may want the full $50 in equity for his efforts and be willing to wait 30-60 days to get it. Or another possibility is that he is in over his head right now and needs to let it go, so determine how urgent his need to sell is and base your offer on that. It could still be a could deal at $105k depending on your intent.
Good luck!
Thank you wigglers for your reply. I will probably past on this deal and keep it moving.