Newbie Alert! Need Help Navigating Distressed Property Deal!

3 Replies

House / Multi-Family Searching for the last 4 months. 100+ properties, nearly 10 offers. It's been rough lately as I'm sure you guys know.

We've kept our eye on a property down the street from our current residence that we heard no one has lived in for nearly 10 years.

Finally, today I noticed they have a junk company getting rid of everything in the house. I stop by and I'm able to talk to with the owner for 30min. She's charmed by me, and I got a full walkthrough and all the "dirt" on the property. I told her our interest in the home. Got her number and she said she would talk with her agent tonight.

Property has so many avenues we could take it. Good rental area. Could be wholesaled. Could be flipped in 3 months. I WANT IT.

We have a fairly green real estate agent. She's only been doing this for a few months so I can't rely on her for investment advice.


My question is: HOW DO I NAVIGATE THIS NEGOTIATION SO I GET IT FOR BOTTOM DOLLAR?

Same home is going for 250-300k with finished basements and no work.

So much needs updating, its a hoarder home stuck in the 1970s with pink everything. I see us potentially putting in a minimal 20k and getting it back on the market in months. At least in a "sellable" condition.

I want it for less than 150k. How would you tackle this if you already had the homeowners number and capitalize on this deal before it hits the market?


We're pre-approved ready to put 20% down with no inspection.


Thoughts please, thank you so much!

"and she said she would talk with her agent tonight." - What does this mean? 

From my experience you need to convince her to not list the property and sell to you. Quick communication, ready to get this deal done ASAP, as is, no major contingences, etc. A cash offer would great but that may not be in the cards. You'll have a million offers on a property like that in today's market. Meet with them in person and get to know the seller. Find the motivation and help solve a problem (big or small). Good luck and keep us posted.

I wouldn't even talk numbers until you get to know the seller. If they want to play ball you'll know it and hopefully the conversation leads to an off-market deal. If not don't take it personal. 

I assumed that she just wasn't comfortable talking any numbers with me and would let the agent know that I'm interested in the property.

I'll call her soon and again reiterate my interest in the property. We'll get it done quickly, sell as-is. Hopefully this will lead to a good deal.

Thanks!

So, I just spoke to the agent representing the owner of the property. 

They plan on putting it up for sale in a week for about 250k..and I quote, "We're going to put it up and let the market decide what it wants to give for it."

This kills me. A house that should be 150-180 is being listed at 250 squeezing the margins so tight.

They mentioned if they needed to go below 250, they needed to do a short sale.

At this point, I do see potential in the property still. Renting single family's doesn't melt my butter like a multi-family would but I do feel there is potential with this considering there's 3 universities near me.

We could quick-turn it for under 20k in 3 months and might be able to flip it if the market is still rockin'. Comps in the area show potential for 300k-325k right now for a very similar layout.

I would love to hear some seasoned investor's take's on this? We have up to 30k to put down, but with the market I don't see how this is will hook them in anymore. Any tactics we could use to negotiate the price? 

Would you recommend calling the homeowner again to try and negotiate with her? Or is that not proper business now anymore since the agent is involved?


Thanks guys! I appreciate the support!