How I bought a home in the middle of town for $10,000

81 Replies

While on my way to a listing appointment last week, I rode around the neighborhood trying to kill some time. I noticed a run down house two houses down from the home I would be listing and I was very intrigued. The grass was overgrown and there was a hole in the roof. This was exactly the type of house I was looking for. The home is located in an established neighborhood right in the middle of town on a dead end street.

I immediately pulled up the tax assessor on my phone and located where the taxes are being paid. The next day around lunch time I knocked on the owner's door and asked if she would consider selling the run down home. Her eyes lit up and she said, "Why yes but I just didn't think anyone would ever want it." Cha ching.

I asked her permission to go inside the house and she said that was fine. Come to find out she was a hoarder like you see on TV. It looked like stuff had piled up in there for 30 years. The roof was caving in and the flooring was rotting away.

I went back to her home the next day and made an offer of the assessed value minus the cost to demolish the house and she accepted my first offer of $10,000. I emailed the contract to my attorney and we closed 2 days later.

The really neat thing about this home and lot is it's actually 3 lots. The house sits on a 75x150 lot but the plat shows it as 3 25x150 lots. The city code today wouldn't allow a home to be built on such a small lot but because this neighborhood is so old it's grandfathered in. So my plans are to build a 3/2 1,500sqft shotgun house and move into it myself. Once that's complete I will build 2 more of the exact same type homes and keep them as long term rentals.

I've already had an investor offer me $50,000 for the property but I politely turned it down. I'm expecting to have $120,000 in equity once I'm done with the 3 houses not to mention what I will be receiving from tenants in rent!

I've had to knock on many doors before finally getting a great deal but it was all completely worth it! I'll be sure to post pics as the progress happens!

Sounds like a great deal!

Awesome!  That's a dream deal.

That's awesome @Stephen Hundley

Just from sitting here looking at your pictures, I want to take another shower now!

congratulations on your home run!!! Can't wait to watch the progress 

Thank you @Elizabeth Colegrove!  I really enjoyed your podcast! 

@Stephen Hundley   Nothing better than the feeling of closing a deal!  The adrenaline rush alone is worth the efforts!  Next part is finding out how much profit this deal will net you as you bring your plan to life.

Ride the success and get another property under contract! Snow ball effect!

 

This is the type of deal that we all dream about. You went out there and found the perfect deal. Congratulations and I sure can't wait to learn about your progress.

I think it's great that you drive by that property, see and think $$$ and then do something about it! Good job, I wonder how many others drove by and thought what an eye sore! All along missing out on a terrific opportunity.

@Travis Boyer

 It's funny you mention that bc after I posted this house on fb people were commenting how they wouldn't buy the house for any amount of money and little do they know I had an investor offer $50,000 for the property.  

a great deal indeed and an awesome story.unfortunately some miss out due to possibility blindness.kudos for REI education

I can only imagine the stench in there ... smells like money I suppose lol. Congratulations! 

@Stephen Hundley Congrats.  What part of town? I used to live around the corner from Lafonda's restaurant, is that still there?  Doesn't grandfathering/non conforming go away if you tear down and rebuild (or improve by 50% or so)?  It does in most places.

Good Deal! Great Find!! 

Originally posted by @Stephen Hundley :

@Travis Boyer

 It's funny you mention that bc after I posted this house on fb people were commenting how they wouldn't buy the house for any amount of money and little do they know I had an investor offer $50,000 for the property.  

 Got to love the prissy attitude. Too good to clean a house that might take a week for 40 Grand, but they'll kiss their boss's azz working in Walmart for 20 grand a year.

Gee, wonder why I'm single 

Awesome find @Stephen Hundley !

One question, what's the reason for looking up the tax assessor and knowing where the taxes are being paid? How did this help you? Just wondering.

@Eduardo Lopez III

 Great question!  The seller wasn't living in the home so I had to find a way to locate her.  Finding the address where the taxes are being sent led me right to the seller.  I literally just knocked on her door.  

Awesome find @Stephen Hundley !

One question, what's the reason for looking up the tax assessor and knowing where the taxes are being paid? How did this help you? Just wondering.

Really good information! Stephen Hundley

Thanks for the fast response! Will definitely follow this topic.

@Stephen Hundley Hard work and your time and effort paid off! So many investors I meet are lazy. They want to make money, but only if the perfect deal falls into their lap. If the deal in anything but "vanilla", they shy away. I bet a lot of investors have seen that home over the years, but you took the time to engage and make contact.  Congrats :-)

How much rehab do you think you will have to put into this house to make it livable?

congrats on the deal by the way and having the long-term vision! I probably would have taken the 50k and called it a day, lol

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