Triplex offer

15 Replies

Hi,

I'm interested in a triplex. The numbers all work great. My only issue is the roof. It needs a roof. It's never leaked buy it will. A new roof may cosy up to 15k. Should I walk away?

Thanks

Tony

Tony... your offer should be contingent upon the seller replacing the roof (all work done by an approved licensed/insured contractor) and maybe list the roof type, etc (see my scope of work member blog today for ideas on a roof scope).... That would be my angle..

Best of luck

@Michael Boyer thanks. I think her problem is she doesn't want to replace the roof. She went down on price a few times. Her realtor told her if she only replaced the roof then the house would of sold with the original asking price. 

Well, it could be a people issue, too, on her side....One option, and if the numbers work great, I might consider this.... idea:  sit down and run some numbers on upping your offer price to cover the roof or part of it (so you pay for it, but get to do so at a low interest rate, spread 30 years)... 

So maybe you offer 7.5 K over asking but add a strong roof replacement contingency.... Might be worth a look...essentially splitting the roof (and a bid or bids may help to pin this down). I would think a good agent might talk a reasonable person into it...  Best of luck

@Tony Velez discount the price and you fix the roof. and 15k for a roof on a triplex. How big it this roof in sqft? I don't know about connecticut, but here in tennessee I am averaging $2.5/square foot. Why is that cost so high?

Today my contractor quoted me $4,200 to do a total tear off on a 29 square roof with 30yr dimensional shingles.

$2,400 were for all materials and $1,800 for labor and it will be done in 1 day.  

@Tony Velez ,

I would stick with the lower purchase price and do the roof myself.  I would always prefer to do/hire out the work myself to insure its done well.....sellers can't be trusted! ;)

I too agree that $15k seems quite high....if it's a negotiation tactic with the seller, then good for you, but I'd guess you could get a quality tear off and new roof for half of that.  Also, beware of expense management.  The tear off and replacement is the last step in the life cycle of a roof.  There are often repairs that can be made to extend the life of the roof at a much more reasonable expense.  Obviously there comes a time to do a full replacement (you don't want to risk a major leak/damage to the interior), but if you can spend $500 now and get another 5 years out of the roof as is, that might be a good business decision.  Your judgement call, but consider all options!

Roofs are a common issue in Texas.  Specifically in the Austin area market.  Many of the properties we are buying have deferred maintenance like a roof.  Very rarely are we able to get seller to replace.  

If all else in the deal looks good... go for it! 

Check the actual operation performance of the property like:

It's already tenants ooccupied?

If yes, what is the vacancy rate?

Ask the seller to give you the rent rolls and check effectively with is the amount of every single unit.

Are you thinking to live in the property?

Do you want to manage the property yourself?

One last thing, be careful if you working on a pro-forma furnished by the realtor, the numbers sometimes are crazy...

Hope is gonna help you!!

Originally posted by @Tony Velez :

@Davide Pascucci the beauty of it is. All the rebrands have been there over 10 years. And they plan on staying. 

 Sounds Great!!! So, once again, let's do the math and see what happen! Maybe you can re-pay easily the roof with your rents and get positive cashflow.