Hey BP! Was just throwing this out there in hopes of some experienced advice. My wife and I are expecting our fifth child, so I tied up all the cash I had to invest with in acquiring a bigger house. I am only financed for about 18k in the house and when we finish it, I feel it will appraise 100-120k. Our plans are to pull some of that equity out and get some rentals with, but here is my current issue (I know that was a long story to say I have no cash). We aren't ready with the house to tap that equity, and a 10 unit apartment in a good location in my town has been listed for sale for 70k. It is 10 1br/1bath apartments close to jobs and stores. They should all rent from 300-400 conservatively. They all are needing some work (I will be viewing soon to know more) and are all vacant. The seller is an older lady, and from what I gather, they were her husbands (died 2 years ago) and in his final years he couldn't do much upkeep and nothing has been done since his death. I would really like to pick up these units, but I'm at a loss on a strategy. I was thinking about seeing if they would owner finance, but then I'm still short on some down payment cash. Any advice? Thanks!
Hi @Daniel Warren . Congrats on your 5th child! Whoa. I only have 2 and I am busy. I can appreciate what that must be like.
If the plex checks out after you see it, I would try and refi my house as-is and/or try and partner with a contractor or other investor. $70k is such small $. I know you need repair money as well, but just get creative. Most widow/probate folks don't want or don't grasp seller financing. You can ask. Is this also a listed MLS deal with an agent? Strike 2. Try a letter of intent that outlines 3 ways you would be willing to buy, maybe. Can't hurt.
After seeing all the "price is too high to find a deal" on the forums here, I would get busy finding a solution. Good luck and keep us posted!
Thanks Steve! Yes I forgot to mention it is listed through a real estate agency, and the local "big real estate investors" are already looking at it. 😁
It's hard to be in competition with those 'big investor' guys on the MLS. Know there will be another property if this doesn't work out. Don't give up yet. Not at all. Many a place has broke my heart over the years. Glad you are out there seeing things that pop up. That's great!
Off-market will always be the best of course. The MLS can be a heartbreaker. As you are out in the market letting people know what you do, it will get easier. Sometimes things work out for the best. Hang in there and keep trying to find a solution to this one @Daniel Warren !
With the birth of your new child you will be five times blessed! You will also be extremely busy with the needs of your family. I read your profile. You said you have no experience, so you would be new to rehabbing and new to landlording, right? Everyone needs to start somewhere, but it seems to me a 10-plex would be too much to cut your teeth on, especially while holding down a full time job and considering the current needs of your growing family.
However, to build experience and to position yourself better, it would be worthwhile to do the analysis on this, build a team (which includes a lender), and perhaps find a partner with experience and capital. If it is a real deal it will likely be snatched up by the experienced investors who are already well positioned and have their teams in place. But, if you appeal to the widow from a different angle, such as how you intend to honor her husband's legacy by bringing the property back to glory, she just might want to sell to you instead. Good luck!
Thanks Marcia. Yes I don't have any landlord ing/property management experience, but I have done a lot of renovation in my own homes. You are right, I am super busy and blessed! That is also my real estate investment motivation. I want to "get out of the rat race" as they say, and I just can't keep running through my head that even only counting half of the rent at full occupancy, this one unit would match my current income level!!
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