Posted by Brent_IL on November 15, 2000 at 23:56:11:
The tired owner of an apartment building may be very open to CRE offers. In particular, low down w/ seller-held second. For the most part they are not novices with regard to cash flow, and will desire to keep their own at a high level. Phil is right that it is solely your responsibility is to make sure the net income will cover ALL expenses and contingencies including management (higher legal, too). It’s easy to buy an apartment building on contract, but it’s harder to guarantee a first year positive cash flow. I don’t want to sound negative. When I first started making offers on multi-res buildings I thought the sellers were slow-minded and that I had all the answers because my state-of-the-art calculator showed me the way to the shining light of profit. From these not so slow-minded sellers, I learned that a calculator couldn?t produce money to pay bills. Neither can it evict a non-paying tenant, who is outside of my 7% vacancy factor and refuses to get with the program and move to the paying side. Sorry about the ramble. Check out the commercial board for posts from people that do this all the time. Verify the numbers.