Hello!  I am a new member from Indiana. After my Divorce some years ago, I rented a unit in a 4/5 unit apartment building that was built in 1935 by the owners Grandfather.  The owners, a wonderful Senior couple that lived below my unit, were renting below prevailing rents, and caring for property was becoming difficult.  We developed a friendship, and though I was still going through the legal issues surrounding my divorce at the time, I became aware that their children had little interest in the property, and I expressed interest in one day purchasing the property from them should they like to sell in the future.  In fact, it sort of became a running joke.  I often would help my aging landlord with repairs, encouraged him to raise rents that were lower than what they aught to be, and taught him to advertise on Craigslist for tenants.  After 2 years there, I moved out, but maintained occasional contact with the couple.

I recently contacted them again, and expressed interest in the property, to find that they have since moved a few hours away nearer to one of their children, and that managing this property has become difficult enough that given the right situation, they would be interested in selling.  I have driven to property to discover that the maintenance appears to be deferred, even though there is a "manager/maintenance" person there with reduced rents.



Property built in 1935 (BRICK)

4 two bedroom one bath units

1 one bedroom unit in basement which is a legal unit (due to age) though no egress windows are present

Laundry area in basement containing 2 washers, 2 dryers

4 lockable Storage units in Basement

4 car garage

Condition: (based upon my knowledge of property, haven't inspected as of yet)

GARAGE ROOF: has many layers and though doesn't appear to leak as of yet, it is in need of replacing.

BUILDING ROOF: appears to have two or more layers on it, and does not leak, though it will eventually need replaced

WINDOWS: 26 windows, mostly crank out old style with small panes.

HEATING AIR: Boiler in basement that services all units, making heat included in rent.  Individual window air units in each unit.

WATER: One water supply, making water included in rent

ELECTRIC: Individual meters for the 4 two bedrooms, making each unit responsible to pay electric on their own.

CURRENT RENTS: Gross: 3050 -(2 bedrooms:700, 700, 675,and 400 for unit with property manager) 575 for basement unit. 

Owner states that his tax records indicate that his net earnings of apartment is $20,620 /yr


I am thinking that  they could easily be rented out to students.  Currently students at the University are paying $6,910.00 per student for two semesters to live in university housing.  Students must live in campus approved housing for freshman and sophomore years, and junior and senior students with scholarships are also required to do so, however juniors and seniors without scholarships tell me they are anxious to live "off campus"

Since apartment is one block from university, students can walk to campus, saving them parking permit fees.

Additional income could be had by putting in coin laundry, soda/snack machines, and renting out storage units in basement as well as garage space.

I have a friend that currently is the maintenance man for the entire university, and he is questioning students as to how much rent they are paying to live off campus currently.


Rent furnished apartments to 4 students per two bedroom and two in basement unit

Rent furnished apartments to 4 students per two bedroom and create common area in basement for study/recreation

Rent all units unfurnished

Option to raise rents by including all furnishings, cable, wifi, cleaning service etc. with them simply paying rent and electric.


tax value (not market value) 105,000

Taxes $2,200 with no exemptions

Property currently has a 30K mortgage left of a 55k loan previously taken out to "give first child his half"

Owner, due to age is most interested in payments, and leaving remainder to 2nd child for "her half" 

Owner has expressed the following offer :

30K to pay off current mortgage, and 250K to purchase an annuity that would pay $10K/year for his and his daughters lifetime.

In its present state, I question whether the property is able to be financed FHA due to condition, though it is a solid building, the maintenance has been deferred.

comps on property are practically non existent.


I have perfect credit, and am about to flip a seasoned home with no mortgage and expect to clear approx. 70K.

I am single, steady long term employment, and have no debt.

I have a realtors license in inactive status, and have hands on experience with major property improvements.

I am a "Dave Ramsey" girl, and debt makes me quiver...  :-)

Note: Property is currently in a Life Estate Rev. Land Trust, and care to not trigger a problem with 5 year look back for Medicaid, and excessive capital gains for current owner is desired.

Advice/thoughts on all matters surrounding this deal are greatly appreciated!