heres what im looking at:
-house listed @ $45,000
-on market for 60 days
- i want to offer 28k-31k cash, no financing or inspection contingencies other than the walk through im gonna do this evening. i intend to hand over the offer to the selling agent at the walk through.
- blue collar area however within walking distance to a nice upcoming entertainment district highly sought after by people my age ( mid 20's)
-needs a good amount of work (something i do myself and enjoy) and someone seeking a mortgage likely wouldnt qualify due to current condition so this is pretty much investors only. current owner inherited the property and is living in it, looking to sell to move closer to their work on the other side of the city ( according to selling agent). I do not use buyers agents as i prefer to do my own negotiations, and since sellers agents have a bigger monetary interest of getting the deal done ( they dont have to split the commission)
im going to assume the seller wont easily consider my offer it due to it being too low even though the sellers agent said he has only had 1 other person walk through the house so far. what if i offer to let him stay in the house for up to 3 months rent free after the sale so he is not rushed to find a place? cost would be low for me, taxes and insurance are pretty minimal.
anyone else ever offer to let the seller stay in the house for a bit free of rent as an incentive to sell? maybe i could offer to help him move when the time comes? may sound dumb but anything else that I can offer other than money?
I would say anything is on the table in terms of what you can offer that will appeal to the seller. If they are firm on the price what you offer might not be attractive, but you never know until you ask. Have you spoken with the seller's agent about the likelihood of your offer being in the ballpark? They should be able to give you an idea of how receptive the seller would be.
Free rent is something that is standard in certain types of real estate deals, I am buying a self storage facility where the current owner is occupying 6 of the units. They have asked for 30 days after the sale to move their stuff so we have put that in the contract. If they stay past the 30 days they owe me rent like any other tenants.
If you do decide to make the offer including free rent for 3 months make sure to be very specific with that in the offer, as well as stipulating what will happen after 3 months if the seller-turned-tenant has not vacated the property. When in doubt, make sure everything is IN WRITING so there can be no debate.
Thanks for the comment Brandon. I really want the house because of the location, awesome strip of craft brewery bars and restaurants... I even have allot of friends that would wanna rent it
but im looking at it as a long term rental and i just cant get the numbers to work with a purchase price much above 30k based on comparable house size/rents & renovation costs. I really cant think of anything else that a buyer can offer other than some free rent...
How did the walk-through go? When you make your lower offer, make sure to provide the comps you used to determine the offer as well as your estimate of repairs needed. This will help the seller understand you aren't just trying to lowball them and get a steal of a deal.
And to address another part of your original comment, i would never assume something about the seller (about not considering your offer). You never know their situation, they could be willing to drop the price or take your offer because they are tired of holding out for the higher price. I have learned to not make assumptions or make decisions for someone else, the worst they can do is decline your low offer.
If you haven't made the offer i would first make it WITHOUT the free rent offer. If they indicate a need to stay after the deal closes then you can counter by offering free rent. That would be a good way to counter without countering with a lower price.
I offered 26k without any contingency and a $2,500 earnest deposit.
home needed more work than I anticipated, im estimating the repairs around 27k. The free rent part didnt make it into the offer but I did bring it up to the sellers agent which was who i made the offer through. I gave them till this Friday 5pm to respond. I debated on giving them even longer, such as a week or two just to indicate that im not concerned that higher offers will come in the mean time. I could still do that when/if they counter
just thought i would update. so I got a call from the sellers agent today. says seller is "still too emotionally attached to the home", he said he thought the offer was reasonable based on the amount of work needed. He made the comment that it sounded like she may come down to 35k possibly. I told him that the closer I got to 30K the harder it was to make the numbers work on paper so I would call him and touch base in a month or so.
So I found another house, also inherited from family so no mortgage, same neighborhood, same price actually (45k) also needs work but not quite as much. after researching I made a walk through appt. set for tomorrow. I did a preliminary estimate and Im assuming I can offer somewhere between 28k to 33k after the walk through and I confirm/change the estimate. the seller has been dropping price every 20 days by about 4% so this makes me think they are motivated. the last house they never dropped price. on this house I talked to the sellers agent and he said they are difinitly motivated to sell and to make an offer, he said the seller told him to "get it sold." I told him to bring a purchase agreement with him and I will do a written offer at the end of the walkthrough.
i wonder if its a stigma of offering anything in the 20's when they are listing in the 40's? maybe if i can offer 30k instead of 29k than that would get over that round number stigma for the seller?
Im kinda doing this also as an experiment also to see how much I can get off the list price of a house.... I would think if i offer substantially low on 10 (assuming i can make the numbers work) or so houses surely 1 has to bite.
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