Neil,
I don’t Know the area in particular. And maybe a lease option will be OK. But Here is what I can tell you. Many Lenders are afraid of row homes in fact many of them refuse to finance them.If the home is in a declining neighborhood you might want to consider what could happen. Such as values going down and being able to excercise the option at a later time. And finding a lease option tenant that is dependable for this area.
It sounds a little scary to me but maybe someone else on here has some positive insite for you.
Seller called on an I buy houses ad. Has a 3br/1ba row in a suburb of Philadelphia where the old blue collar workers are fleeing and the inner city folks are moving in. There are 10 houses listed for sale on this one two block long street. I quote, “This in now a renters neighborhood.” She bought in 1988 for 52k and re-fied in 98 for 43,600, at least that’s what the tax records seem to indicate. She has been making two house payments for 1.5 years and is clearly tired of the landlording hassles. This neighborhood seems to be going nowhere but down. It’s such a small deal should lease/purchase be even considered? Is there any way that I can make this deal work? Any suggestions would be greatly appreciated. Oh yes, time is of the essence.
Posted by Jim Holmes on March 17, 2000 at 24:36:02:
Neil,
Neighborhoods go down and go up. The question is where is this one in the cycle. If I were you, I would do a lease option and make sure the tenant can make your payments for you. Fix the price low == very low and extend your term as long as possible. With a little luck, prices will start back up and you can exercise your option with some built in equity. On the other hand if the neighborhood continues to decline, get out with a lot less at risk than to own it.