Ok guys, I am 100% new to this, so go easy on me. I am looking at generating passive income over the next few years with some buy and hold duplexes. I am going to go view a few this upcoming weekend and have a question:
I am looking at a unit that is currently occupied on one side by its owner and on the other by a tenant. The owner has stated that they would continue to live in the unit once sold, but just didn't want to deal with owning it anymore.
I am a bit nervous that the current owner might feel some form of "privilege" having owned it. Basically I dont want this to end up being a relationship where they think they can tell me what to do as they have owned the property for years. With this being my first deal I dont want to make it any more difficult than it has to be.
Has anyone else dealt with this? Did it end up working out ok for you or was it something you ended up regretting?
Any and all help would be appreciated. Thanks in advance!
As long as he didn't lose the duplex, such as a foreclosure, I wouldn't see an issue with it. I would suggest a sit down eye-to-eye conversation about how the new sheriff is going to run this town. To include; a month-to-month lease for 6 months or so, as a probationary period ( I wouldn't call it that but I'd make sure that he understood it as such) and of course make sure your leases are tight and the other tenant knows he isn't the owner any more.
Good luck, let us know how it works out!
@Robert Rodriguez I was faced with a similar situation, and the consensus was that he will never lose the home owner mentality. He will always view it as his place, and may not respect you as the new home owner. I never rented to the owner, but something came up so I never had to make that decision. Good luck with whatever you choose.
OTOH, if his place is well kept, he will probably keep it that way as a tenant.
We bought an apartment building last year and the owner was living in one of the apartments. He kept telling me that he would be out in a couple months. Well, here it is a year later and he's still there. His wife told my wife a few weeks ago that they are probably going to be there for a long time.
I wrote him a $300k check last year so I know he has the money to make the rent. He can stay as long as he likes...