I have a coworker with a rental property in Baltimore md who's pulling his hair out because the tenants are inconsistent with paying rent on time. He frequently speaks off selling the property but wants top dollar. How can I talk him down and convince him to let me take this burden off his hands?
Which has more value to you? Your friendship or the money you would make off the deal. Regardless of how you convince him to sell, if you end up making any money off the deal, it will come out of his pocket and he will, in the end, be resentful.
Just because someone complains about something doesn't mean its a burden. If he wants to be rid of it and wants full retail price, advise him to put it on the MLS.
@Jon Holdman my buddy has a passive non aggressive attitude about the whole situation. I would love for him to get top dollar for his property but if he's not actively seeking an agent because his LTV is upside down why wouldn't I take advantage of the opportunity and show him other options?
Help him get aggressive with the tenants, evict, and start fresh, with GOOD tenants. Just a thought... if he starts making money on this house, sell him another one. Make your money on making him successful.
The job of the real estate investor is more finding motivating sellers than convincing sellers to be motivated. There's certainly negotiating and influence involved, but you can't make someone be motivated. Indeed, one the best methods is simply patience. Make your case calmly and politely and if time continues to pass and these problems continue, maybe he will come around. Or maybe not, and then you find a good deal elsewhere.
The cleanest approach would be to purchase the property outright, but there are other options. Have you thought about having your buddy lease-option the property to you. Without know the details of the deal, you could offer a good price to him if he were willing to finance the deal in a way that made it profitable for you. You could also consider a partnership of some type where you took over management for a portion of the equity and cash flow.
@Dexter Dickerson What options do you want to show him for this upside down property? How far upside down is it?
You can't create motivation, your job is to find it.
@Wayne Brooks possibly a short sale
I like this,
"The job of the real estate investor is more finding motivating sellers than convincing sellers to be motivated."
You could simply sow the seed by telling him you would be interested in buying the property and leave it at that.
I am surprised when I do this at the number of time people will later (sometimes months) come back to me and say, "hey, are you still interested in buying...?"
When they do that, you have much greater influence in the conversation.
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