Seller Financing: Multifamily Property (Texas)

8 Replies

Hi All,

Johnathan from Texas here. Starting a new post that I hope would gain some traction here as I haven't seen anything posted on the topic in a while (unless I overlooked).

After doing some research, it seems that purchasing a seller financed property could result in a great deal for both parties. On a few older forums, I saw Listsource and networking as possible leads for these properties. But does anyone have additional thoughts on how I can connect with these potential sellers, especially multifamily property owners?

Thanks!

Hi Johnathan

I'm interested in seller-financing multi-family properties as well. So far, I've found two and one possibly through a real estate broker. In one instance, the seller had very specific terms. In the other two, it's new to seller but they are open to the idea.

As far as the sellers, one is an experienced investor who wants out but isn't ready for capital gain tax. Another has moves out of state. He has already sold another Texas property. I'm not sure about the third. By the way, their motivation was revealed by searching public information. I haven't spoken personally to either seller. My assessment was confirmed by my broker on the first though.

I'm in Texas as well. Happy Hunting :)

Yolanda

Thanks for the response! You mentioned searching public information. Did you do a Listsource grab of properties with high equity or you had another way to coming to that conclusion?



Originally posted by @Yolanda Columbus :

Hi Johnathan

I'm interested in seller-financing multi-family properties as well. So far, I've found two and one possibly through a real estate broker. In one instance, the seller had very specific terms. In the other two, it's new to seller but they are open to the idea.

As far as the sellers, one is an experienced investor who wants out but isn't ready for capital gain tax. Another has moves out of state. He has already sold another Texas property. I'm not sure about the third. By the way, their motivation was revealed by searching public information. I haven't spoken personally to either seller. My assessment was confirmed by my broker on the first though.

I'm in Texas as well. Happy Hunting :)

Yolanda

Hi Jonathan

This search was for motivation. I searched county appraisal district, found address of owner. Then I searched the same website by name. If there were other properties, I tried to determine when was the last time they were sold. For some I did have to use my subscription to MyREIPro. If the seller's address was in another county, I performed a similar search on that county appraisal district.

I followed that up by searching Google, FB, Instagram, and other websites, depending on my guestimated age of the sellers, for more information about the seller.

All of my SF deals have  been with boomer+ landlords that have been self-managing for decades.

I look for tired plexes like 70's builds that  need paint and window coverings with smokers and pit bulls as tenants and crude for rent signs.  

I also look in the newspaper and craigslist for basic for rent ads that provide landline phone numbers.

Facechat, instabook and the others mean nada to these folks. Me either, obviously. You'll find them in greasy spoon diners in the morning and the gold circuit gym class.  

Good luck @Johnathan Mark

@Steve Vaughan , appreciate the feedback here. By "look for", do you mean you drive in certain areas taking note of possible properties?

And it seems like your strategy is to find a property then make an offer as opposed to finding a seller actively on the market. Am I reading correctly?

Originally posted by @Johnathan Mark : By "look for", do you mean you drive in certain areas taking note of possible properties?

And it seems like your strategy is to find a property then make an offer as opposed to finding a seller actively on the market. Am I reading correctly?

Yep, when I'm driving or biking and taking different routes to get to where I'm going, I keep an eye out or 'drive for dollars'.  I used to drive for dollars on purpose with a map, crossing off streets as I covered them.

I reach out to tired looking plex owners via a nice letter or postcard and try to build a rapport with them.  Other times I'll call the 'for rent ad' in CL or the newspaper, especially if it looks crude. Special bonus if it's a landline number.

I have my eye on 25 units in duplexes, quads and a 7-plex (my favorite size) owned personally (not in entities) by 5 different people now all over the age of 70.  They are all owned free and clear, some they have had since 1986.

I check in with them every now and then and try to offer them value. Hopefully when they decide to sell, they will let me know first. Seller financing is their preferred way to sell, especially if it's their idea. 

As you do this a while, you will be able to identify a  very specific market or 'farm neighborhood' to focus on.  

@Steve Vaughan This is golden, appreciate the knowledge sharing here. I was leaning away from D4D since I'm an efficiency guy, didn't seem like the best way to find a deal. But reconsidering now.

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