Getting a rental property for free but possibly needing big work

5 Replies

So over the years i have been pondering real estate( at first because my grandad owned 15 houses) so this past year i have dove deep into learning what i can... the other day i asked my grandma if i could possibly take a rent house off their hands (grandad had a stroke). So she actually considered it but was saying the house needed a lot of work possibly up to 10 grand.. the house is worth about 60 thousand but im very young (18) and super eager to get into my first property, am i setting myself up for failure or possibly success?

I'd say go for it. Any idea what the $10K is for? If she will give it to you, take it and learn.

pretty sure the 10k is for foundation problems but it could be less than that, the house will still need some touch ups after that but nothing major

WOW Jump on it! Put the sweat equity in and learn, then refinance the property or take a HELOC and buy your second. That is a sweet route. The hardest property to come by is the first.

Foundation problems can sometimes be remedied by a handyman and sometimes it requires a bulldozer. Most often something in between.

Make sure you investigate the situation closely before moving forward. This will part of your learning process. (research, get quotes, maybe pay to have an engineer examine it, find out if you would need to pull permits and whether that will trigger code compliance with other parts of the structure and so on and so forth). Just because something is cheap or free doesn't mean it's a good deal. If you have a close relationship with your Grandma, pick her brain to find out as much as you can about the property. ie, why didn't they fix it?

Best wishes in your adventure.

@Josh Hutson

Have you ever heard older people say something like this: "This younger generation just doesn't get it.  They don't have to go what we went through.  What is the world going to be like when they are in charge?"

None of this applies to you.  If you are 18 and thinking along these lines, you are setting yourself up to win in the long run in a huge way.

Take control of that house.  Ask a ton of questions in BP.  Get creative.  The world is full of renters right now that would love to clean that place up for a break in the rent.  If the place is paid for (usually goes along with grandparents owning anything) you can find someone who will pay you to renovate it in the form of a tenant.

Or sell it.  Pocket the $50K but only use the money for the next place.  Don't spend it.

Good luck.  Please reach out if you need anything.

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