New investor looking at 24 owner owned for $750,000

8 Replies

I was offered a deal on a 23 unit 3.5 acre park with another house for $750,000 in NC. Location is fairly good, land is on a major rd and the back part of it connects to an established neighborhood with older brick SFR’s All units a tenant owned, utilities aren’t included and overall condition of the park is on the low end. Main driveway is practically dirt pavement mix. Pods are rented for $275 which is $75-$150 lower then larger parks within 2-3 miles that are in a nicer park. Taxes are $6000, manager lives at site in a separate building which is the office essentially. The owner turned down an offer for $625,000 from a different buyer yesterday and the agent is insisting this is a 20% cash on cash deal with 30% down over 20 years. It seems too good to pass so I’m intrigued but I don’t have enough knowledge to tell what I’m missing

Do you know anyone that you could bring into the deal who has done a deal like this in the past?

are there any vacancies (it’s good if it’s a “yes”)? Can you bill the tenants back for the water and sewer bills (it’s good if it’s a “yes”)? I think This is a high purch price for 23 lots. If I were you I would do test ads to see how the demand is on filling vacancies. 

No vacancies and tenants are already paying for water. After reading through the forum I concluded the same, the other buyers offer for $625,000 was as high as someone should bid but it was rejected. I’ll hold off for now, thanks for your input!

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@Giora Sela I'm not sure why the agent is being like that. If you're going to make an offer, I'd try to see if you can make it with the seller present. Seems like the agent may be more concerned with getting a larger commission than giving you a fair price and a chance to show your perspective with the seller. Too many red flags here. Good luck! 

Sounds like agent cant do the math
Lots of red flags
Overpriced

PASS.............   sense a few red flags here.

Like someone else said, lots red flags.  I guess I’m not sure why the gap b/w $625k and $750k.  Ok, seller said no to 625...go $650k.  Maybe even sweeten the terms (quicker payoff, etc).  But no way should you jump $125k, just because.

Don’t necessarily trust the agent; do your own due diligence.  This goes for financials and profits especially.

One final thought..you said you were new.  Have you done any smaller deals to-date?  Do you have any experience owning rentals in any capacity?  This is a rather large deal to get into unless the experience is there..

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