So here’s the deal: An FSBO close to a downtown, prosperous city. The owner bought it 18 months ago for 345k. Now asking 370k. Market is not supporting this price. Owner has moved across the country. Owner is behind on taxes (1 year). Owner did not go conventional; put $4500 down on a price of 349,500. Owner tried to rent for $1900/mo, got $1800/mo. Tenant has moved out and house has been vacant for a few months. House is 2/1, but there is a room behind one bedroom (you need to go through one bedroom to get to it). There is a basement, with access outside the house. Roof may need repair in about 3 years, according to neighbor who is a general contractor. House is being marketed as a 3/1, but the floorplan is not user-friendly. There is a garage, but it was built in 1927 when cars were much smaller. There is a carport, not permitted, and is not built to code. Basement floods. So. Could this somehow be a good buy? I was thinking of buying it ‘subject to’, with a lease-option and a hefty down. But I see many pitfalls, not the least of which is the bank finding out and calling in the loan. Also, when the buyer exercises the option, how would that be handled since the original owner has the mortgage? Obviously, total new investor here. Just started studying seriously about 3 weeks ago. No deals as yet, but I have made two contacts by walking the neighborhood and talking with the owners. Any help greatly appreciated.
Interesting story but NO informative details. What is current market value. How much is required to get it in TIP TOP sales position. What do YOU want to do with it? Just a few of the things that go into making a real estate investment.
Jim,
I pass on many deals that are clearly more straightforward and easier than this one. I can tell you that on a property that needs work, that old, and can currently be rented for about $1,900/mo I wouldn’t pay 50% of what he’s asking. My recommendation: look for an easier deal. They’re out there.