My Condo for Sale - or Rent? - Posted by Reif
Posted by Reif on March 11, 1999 at 20:09:03:
I bought a condo, fixed it up, (comps now 92K) and was going to sell it on terms, I was hoping for 99K, 5K -7K down and wrap about 10% over my 8.5% underlying.
Anyway, for whatever reason, I was unable to convince folks to go for it - even with the hot San Diego market.
Except one person.
I have an offer of 98K, with 20K down - but my buyer wants bank rates.
My problem? If I give him the deal, I have to pay down my underlying so I don’t get upside down underneath, to the tune of about 8 thousand dollars.
That means I will have eight thousand equity in the place tied up earning no interest until the buyer cashes me out.
My last thought is to try to get him to go for 20K down - assume the note.
It’s only $35 more a month than he would pay at ‘bank rates’ because it’s interest only.
Then I would tell him when he feels comfortable with his credit situation he can refinance (actually, I’m pretty sure it’s more complicated than just credit).
My other alternative is to rent at about 250-300 bucks a month positive cash flow.
My problem with that is a) landlording and b) 13 grand (down plus fixup plus two months holding) tied up for awhile.
I know I didn’t buy it right - water under the bridge. What do you guys think the best strategy is?