Buying townhomes from multiple owners?

Question

I was curious if anybody has tried or had success putting together a package deal to buy both/all connected townhomes where the units have different owners.

How did you approach the different owners?

Are there any tips you could offer to increase the likelihood of an adjacent owner wanting to sell to you rather than gouge you?

Also, I'm wondering if people have thoughts about the benefit of owning the units as a block from a wholesaling perspective, or from a buy and hold position, etc.

Jordan Powell · Answer

I'm not sure you understand what I meant, and that's probably my fault for not explaining myself well. No worries. :)

It struck me that owning and thus controlling three of three physically conjoined properties—not merely "close together" properties, but wall-sharing—might present some benefits (similar to owning all of one color in Monopoly, though I'm sure that's too simplistic of an example). I wondered what some of those benefits might be and if it would warrant a little extra effort to try to secure the one end unit owned by another party.

Thanks for chiming in. Sorry if I'm not making a lot of sense!

Pete T. · Answer

@Jordan Powell  if the properties are all owned by different people, why would there be a discount buying more than one?  If you already like the deal and have an opportunity to get a discount, that is obviously a bonus.  If owned together, I am sure you could arrange a larger discount buying all together.  It is also nice to have 3 places close together, but not sure exactly what you meant by less competition for rent.

Jordan Powell · Answer

Hey @Pete Thomas , thanks for the response. I guess my real question was really something like this: is there value in pursuing all connected units if the route was open to do so?

I brought it up because I saw a townhome for sale connected to two others, an end unit. The listing mentioned that the middle was also available at a discount if purchased as a package. That made me wonder if there is a compelling reason to also purchase the third unit if possible—I mean, beyond whether it is a good deal by itself. I am interested in the thought process an experienced investor would go through on something like this.

Less competition for rents? Control over tenant screening? A better package deal for wholesale offload?

I just wondered if anyone had put together a creative or value-adding deal this way.

Pete T. · Answer

What is your exact goal in this?  I am assuming there is more than just wanting to own properties together or in an area you find favorable?  If not, the question then becomes, can you get good deals on all of the properties?  Based just on the info provided, I would guess no, especially if any of the sellers thought there was some reason you wanted to get all of the properties.  Do you have any other information on this?