Posted by TomC (Md) on June 20, 2000 at 10:58:55:
I agree that a zero monthly spread is not worth sticking your neck out for. Especially if you are responsibe for lost rent if your T/B has to be evicted or vacancy while you put a new T/B in there!
Depending on where the townhouse is located, I would consider all your options. Up-county like in Germantown, the re-sale market for townhouses is slow, since the builders are still making more. That may make the FMV a little lower that what you would expect.
How much rent credit are you going to offer the T/B? With you only getting $100/mo from the seller, that leaves little room to offer any to the T/B. You may want to figure out exactly how much the depreciation deduction will be for the seller. I’ll guess that the house is worth 60K and the land is worth 40K, so the seller should see about $200/mo depreciation. So you might actually be able to pitch a $200/mo rent credit to the seller, and offer $100/mo to the T/B.
Good luck with it!!