Buying From My Landlord

3 Replies

Looking for some advice here - any input is appreciated!

I live in one unit of a duplex.  The landlord is an older couple, who live in Florida.  They only rent out 1 unit and keep the other one open for when they come to the area to visit family a couple of times a year, though they've never made the trip while we've lived here for the last 5 months.  I'm not sure how "well off" they are, but I'm guessing they are comfortable, as they are probably just about breaking even, if not losing money on this property after taxes, insurance, etc.

They aren't marketing the place and we've never heard any mention of them thinking to sell.  We've never met them in person, but have spoke on the phone on a couple of occasions. They have a maintenance guy that handles anything so our contact with the landlord is very limited.

I would love to this property as my first investment property, however, I'm having trouble thinking about how I to be going about this.

My initial thoughts are to just put out a feeler saying how much my wife and I love this area and that we eventually would like to hopefully buy some day and just politely ask that if they were ever thinking of it, to please keep us in mind.

I'm having trouble figuring out how to communicate this message. I'm thinking of mailing a letter, just because we've never met them in person and I'm not sure how they would take it, but I also want to make sure they receive the letter.  We have no idea when they will be back in town, but could also wait until then and try to speak about it in person...

How would you guys handle it?  Also, what kind of a deal would you offer?

@Justin McElroy - I think you are right on track. Drop out a feeler and say its your wife. The whole "My wife loves this area and the house is a great fit for us". Then mention something like: If you ever think about wanting to sell, let me know, and we might be able to work something out so you don't have to pay a realtor 5-6%. 

Its not you offering, but more of "hey, I might be interested, and keep me in mind". Its low pressure but brings up the idea. 

I would also say do it on the phone or in person if possible. If not, just dropping him a friendly email can work. But you can't judge his reaction via email like you can over the phone or in person. 

Before I made an inquiry, I would want to do enough research on properties in the area to have an idea on what you would be willing to pay. You never know if they're going to blow it off or make a proposal right away. (maybe they've been thinking about selling due to under utilization?)

Anyway, it certainly won't hurt anything to ask them if they are considering selling and if they aren't, would they let you know if they change their mind?

Appreciate the inputs, @John Teachout and @Andrew Kerr

I definitely need to sit down and run the numbers.  Andrew great point mentioning the agent commissions.  I would love to do some kind of seller financing, where they get 100% cash flow and don't have to worry about the property/expenses anymore.

Anyone else have experience with this or any other suggestions?

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