Too good to be true?

[Shea Spinelli]

At work today, a customer informed me they had a house for sale priced at 350k, they purchased in May of 2016 for 345k. It's in a premier neighborhood and they are wanting more room so they're selling. They told me they would take 242,500 for the house so they could move it. My realtor showed low comps at 295k. I'm putting an offer (wife consent first) on the home. I would like to purchase it and turnaround and list it for roughly 325k to move it quickly enough and net roughly 30k. Does this sound too good to be true? As long as we write in opt out clauses appropriately it's definitely worth researching. Thoughts? Should we buy and hold to rent? It's not a normal buy/hold neighborhood considering the area.

[Kevin Siedlecki]

@Shea Spinelli - Yes, it certainly looks too good to be true. I hope you can pull it off, but there is just too much that doesn't add up. Why on earth would someone be willing to take a 100k loss in less than a year?

Also, how are you going to sell it for $325k if comps are $295k, especially if your plan is to move it quick?

You are right, get yourself and inspection contingency, and see what's up with the place. It can't hurt to look, except a couple hundred for the inspection. I just don't see any way anyone would be willing to unload it that cheap unless there is a serious problem.

To know whether you should rent, you'll have to figure out all your expenses, but a single family home in that price range would probably need to rent for about $2500 a month to make any sense as a rental, depending on taxes.