Re: Selling inner city rehab properties - Posted by JPiper
Posted by JPiper on April 13, 2000 at 02:09:39:
There are a variety of programs that would typically be useful in the inner city areas. State housing bond type programs are sometimes available. Some areas offer substantial subsidies for low income borrowers. One program I’ve seen offer a 20% grant which is forgivable over 10 years or so.
One of the problems is that the borrower needs to have good credit. These days, with the proliferation of programs, sometimes the good credit borrowers aren’t looking for inner city properties.
A further problem stems from the first problem. Because the good credit borrower is more limited in the inner city areas, your holding period is going to increase, perhaps significantly, while you’re looking for the guy with good credit who wants the inner city. While you may end up cashing out…your holding costs are going to rise significantly, not to mention the risk of vandalism, and realtor costs.
I’m not trying to discourage you…but frankly there is no easy answer. I think I do better offering to help with financing, not using a realtor, and cutting my holding costs down. By the way, you should be able to find buyers who can qualify for better than an 80% loan.