I am looking to get a head start on my first investment. My parents house, which is actually not for sale. They have been renters of the house for 16 years, since I was 4. The couple who owned it when I was little passsed away and it was sold to another man, whom is “broke” (grape vine from my parents) and he doesn’t do much to actually fix anything that needs to be fixed. He pays some under the table random to just do the work that needs to be done and it is not done well. The house is located in Wilmington, NC. The person who currently owns lives in Raleigh. How can I go about trying to purchase the property? Should I hire an agent to contact the owner to see if we can make a deal on the house?
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You might want to do a little research before engaging an agent. I would check your house here: public records search. That should give you the name and address of the owner, and the purchase price when they bought it. Then spend a little time on realtor.com or similar looking at what similar homes are selling for in your area. That shouldn't take to long, but it will give you a baseline of information if you decide to talk to an agent. However, if you can figure out what the house should sell for I would try contacting the owner directly first. Look up creative financing here on bigger pockets and see what options they might have for selling. It sounds like you should get a discount for some serious deferred maintenance.
However (and it's a big however) I wouldn't consider this as an investment property. You'd be doing your parents a favor, not investing - which is a big difference. Good luck!
@Emma Kellenberger I would not hire an agent. This will increase the sellers transaction cost which will increase the purchase price. You should consider a couple things with the negotiation process. If your parents have been living there for 16 years, it probably has the same flooring, has not been painted and has minimal updates. If the seller plans to list the property, he would probably have to spend a good bit of money to make it "market ready." Between having no agents involved, and the seller not having to spend more money to remodel, you might be able to get a good deal. However, you should also consider if your parents move out and you plan on making it a rental you will probably have to spend money to make it rent ready. Good luck!
@Christian Bors , I do plan on making renovations already, if I am able to swing a deal and get him to sell. My biggest concern is figuring out how to approach him! We have never spoken before, he only has contact with my father. How could I utilize my oarents’ ‘renter and landlord’ relationship?
Emma, I would ask your father for an introduction. Have your father tell the new landlord that you are a new to real estate and want to gain more exposure to this business and ask if the new landlord would be able to talk to you and maybe share some experiences from his past to lead you down the right path. Once the conversation starts, you will slow try to get a feel for the conversation and try to hint to him that maybe you are interested in starting your real estate career with your parents current rental and see if he would like to part with it. if he express some interest, then that is where the negotiation start, however if he doesn't express any interest in selling this house to you, ask if he has other properties that he wants to sell off. Don't be pushy, be natural.
if he is willing to sell, GREAT! if not, no biggy, there is always the next deal.
Hope this helps.
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