All
Members
Companies
Blog
Forums
Podcast
Webinars
    User Log in  /  Sign up
  • Forums
    Newest Posts Trending Discussions Followed Forums Real Estate News & Current Events General Landlording & Rental Properties Buying & Selling Real Estate Deal Analysis See All
  • Education

    Read

    BiggerPockets Blog BPInsights: Expert Analysis Guides Glossary Reviews Member Blogs

    Watch

    Webinars Video Library Financial Independence Blueprint Intro to Real Estate: Rentals

    Listen

    BiggerPockets Real Estate Podcast BiggerPockets Money Podcast BiggerPockets Business Podcast Real Estate Rookie Podcast Daily Podcast (Audio Blog)

    Topics

    Business Operations Finance Finding Deals Property Management Property Types Strategy
  • Network

    Recommended Vendors

    Real Estate Agents Mortgage Lenders Hard Money Lenders Insurance Contractors Investment Companies Build Your Team

    Search

    Members Events Jobs
  • Tools

    Calculators

    Rental Property Fix and Flip BRRRR Rehab Estimator
    Wholesaling Mortgage Payment 70% Rule Airbnb

    Services

    BPInsights: Property Insights Tenant Screening Property Management Lease Agreement Packages

    New Feature

    BPInsights (beta)

    Quickly analyze a property address or ZIP Code to compare your rent in your neighborhood.

    Analyze a property
  • Find Deals
    Real Estate Listings Find Foreclosures External Link Ads, Jobs, and Other
  • Bookstore

    Real Estate Books

    Profit Like The Pros Bidding to Buy See all books

    Featured Book

    BiggerPockets Wealth Magazine book cover
    BiggerPockets Wealth Magazine

    Written by financial journalists and data scientists, get 60+ pages of newsworthy content, expert-driven advice, and data-backed research written in a clear way to help you navigate your tough investment decisions in an ever-changing financial climate! Subscribe today and get the Oct/Nov issue delivered to your door!

    Get the Magazine
  • Pricing
Log In Sign up
User
Quick search links
Podcast Hard Money Lenders Books
ForumsArrowMulti-Family and Apartment Investing ForumsArrowShould I buy the 3 family next door?
  • Newest Posts
    • Newest Posts
    • Unanswered Discussions
  • Trending
    • Top Discussions
    • Trending Discussions
  • Browse Forums
Search Nova
Create post

Should I buy the 3 family next door?

7 Replies

  • Share on Facebook
  • Share on Twitter
  • Share on LinkedIn
Rotate Log in or sign up to reply
user profile avatar
  • Posts 11
  • Votes 5

Roland Barbeito
Rental Property Investor from Springfield, MA

posted over 3 years ago

Hi all,

Here's the situation. I own a 6 family apartment building which is situated between a 2 family to the right of the house and a 3 family home to the left. The lots are small. I have just 75' of frontage. The problem I have is the driveway to access the parking area in the rear of the house is very narrow ~10feet wide.  It's a pain to plow and difficult for tenants to enter and exit. There is a 4' tall chain link fence  on the property line which separates my driveway with his. My neighbor (owner) wants to sell his owner occupied 3 family house and move into his own house. He is motivated to sell since he is getting married. He is asking 150k. The last time the house sold was back in 2010 for ~144k. 

3 family house in question has its issues(older home, older heating systems probably)  but I would like to own it as it would: 1. eliminate my driveway/snowplowing issues 2. add to rental portfolio 3 increase monthly income 4. Both properties are right next door to each other - easier to manage.

Has anyone had a situation like this? If so, what are some tactics I can use to convince the seller to lower his asking price and win him over? The house needs work and at 150k, the house is not worth buying.  I would like to be down around $100k to $120k.

Thanks in advance!

Rotate Log in or sign up to reply
user profile avatar
  • Posts 2.3K
  • Votes 1.3K

Account Closed

replied over 3 years ago

the tactic is to offer him what you consider it worth and explain the reasons This will open up the negotiations and maybe a compromise will be made 

Rotate Log in or sign up to reply
user profile avatar
  • Posts 47
  • Votes 13

Amy Fowler
Investor from Royersford, Pennsylvania

replied over 3 years ago

@Roland Barbeito I would definitely be aggressive and purchase the property as long as the numbers make sense. It could solve your driveway problem but if the numbers don't work, you could put yourself in a negative or very little cash flow situation. Then there's really no benefit. If he's truly motivated and it needs work, I would see what the repair/replacement cost would be, work my cash flow numbers and then offer a fair price. 

Rotate Log in or sign up to reply
user profile avatar
  • Posts 1.4K
  • Votes 843

John Leavelle
Investor from La Vernia, Texas

replied over 3 years ago

Howdy @Roland Barbeito

I would analyze your market to determine a good ARV based on recently sold comps. It is extremely important to know what the market is. What are the current rents and what is the market rates? Current income? Projected income? You need to come up with a Rehab Estimate to help justify your lower offer. Keep emotion out of it. Yes, try to help him out. But make a sound business decision.

Rotate Log in or sign up to reply
user profile avatar
  • Posts 11
  • Votes 5

Roland Barbeito
Rental Property Investor from Springfield, MA

replied over 3 years ago

Thanks for the helpful tips all!

Rotate Log in or sign up to reply
user profile avatar
  • Posts 1.5K
  • Votes 2.0K

Omar Khan
Rental Property Investor from Dallas, TX

replied over 3 years ago

@Roland Barbeito Without knowing the specifics of your deal, have you tried inquiring about owner-financing i.e. where the seller carries the note for you? This will provide him with a steady source of income as he's moving into his new home and provides you with additional flexibility. Furthermore, if the #s make sense, combining the buildings can work wonders in cutting your overall expenses. 

Rotate Log in or sign up to reply
user profile avatar
Check Rosette Top Subjects:
Flipping, Taxes & Accounting, and Team
  • Posts 1.6K
  • Votes 792

Marian Smith
Real Estate Investor from Williamson County, Texas

replied over 3 years ago

Determine how much you want the place. My friend overpaid for the office next to his current office and was thrilled to do so. Perfect solution for him. You do not want the neighbor listing on mls or other network because you have no way of knowing what someone else will pay for the place (of course, it could also work in your favor but that too is a gamble). If he gives you a number that works, and I mean financed in costs you a couple hundred a month (if that is reasonable to solve your problem), then agree. Let the inspection help you get to a more reasonable price...or get you more comfortable with price paid....or use inspection get him to repair/replace obsolete systems. Maybe he will carry a second...loan you the down payment out of his proceeds. Then you would have capitol to do repairs. I understand the place needs work, but he owns the only solution to your problem.

Rotate Log in or sign up to reply
user profile avatar
  • Posts 54
  • Votes 29

Lucius Carroll
Real Estate Broker from Nashville, TN

replied over 3 years ago

I'd suggest running the numbers as a stand alone opportunity - find that price & offer accordingly.

Additional upside can be found in the areas you mentioned - ease of access, economy of scale with service providers, time efficiency for management, possibly offering additional price points in your portfolio, ...

Contiguous property is worth more to adjacent owners. Just don't pay for it - we make money when we buy.

Rotate Log in or sign up to reply
  • 1
Related Resources Multi-Family and Apartment Investing Forums
6 Tech Tools That Make a Landlord’s Life Easier
Turtle Soup in the Kitchen Sink — Or, Why You Shouldn’t Skip Yearly Rental Inspections
What Is Rent Control—And Is It Bad for Landlords? (Updated 2021)
How to Choose a Management Company for Multifamily Properties
Trouble Collecting Rent on Time? Try Flexible Rent Payments
Resources Read, see, and learn more!
Link Real Estate Investment Calculators
Link BiggerPockets Blog
Link Path to Purchase
Link Mortgage Loans
Link Find a Contractor
Link Real Estate Agents
Link Hard Money Lenders
Link Real Estate Listings

Top Contributors

Justin G.
Justin G.
Indianapolis, IN
10.0
Score
Jeffrey Donis
Jeffrey Donis
Durham, NC
4.96
Score
Patrick Flanagan
Patrick Flanagan
Beaverton, Or
4.87
Score
Danté Belmonte
Danté Belmonte
Syracuse, NY
4.57
Score
Arn Cenedella
Arn Cenedella
Greenville, SC
4.16
Score

Multi-Family and Apartment Investing Forums Trending Discussions

  • Top 5 best multi family markets
    66 Replies
  • “Conservative UW is Dead”
    18 Replies
  • Stocks vs. Real Estate Investing (I am new to investing)
    10 Replies
  • Indianapolis Market is 🔥
    12 Replies
  • Feeling Stuck & wanting to take that plunge
    10 Replies
Log in Sign up

Log in

Forgot password?

If you signed up for BiggerPockets via Facebook, you can log in with just one click!

Log in with Facebook

Or
btn_google_dark_normal_ios Created with Sketch. Continue with Google

Let's get started

We just need a few details to get you set up and ready to go!

Use your real name

Use at least 8 characters. Using a phrase of random words (like: paper Dog team blue) is secure and easy to remember.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.

Or
btn_google_dark_normal_ios Created with Sketch. Continue with Google

Why create an account?

Receive a free digital download of The Ultimate Beginner's Guide to Real Estate Investing.

Connect with 1,000,000+ real estate investors!

Find local real estate meetups and events in your area.

Start analyzing real estate properties, we do the math for you.

It's free!

Explore

  • Membership
  • Community
  • Education
  • Marketplace
  • Tools
  • FilePlace
  • REI Resources
  • Perks
  • Glossary
  • Reviews
  • iOS App
  • Android App

Company

  • About Us
  • Press
  • Advertising
  • Careers
  • Stats
  • Contact Us

Important

  • Editorial Guidelines
  • Terms of Use
  • Rules
  • Privacy
  • FAQ

Social

  • Facebook
  • Twitter
  • YouTube
  • Instagram
© 2004-2021 BiggerPockets, LLC. All Rights Reserved.