Help! 1st deal and we might be crazy!

9 Replies

We are looking to get started on our first real estate deal. We have found a really nice house on piers for 10k (to be moved) 1000 S/F living, as well as a vacant lot for $40,000 (seller pays closing and water is already there). We estimated moving and all set up costs to come in around 30k. This includes pad, sewer, electrical, HVAC etc... this leaves us with 20k-25k for any renovations that might be needed after moving. We estimate ARV to come in around $150,000, but have prepared to be ok with as much as 130k.

Thats the deal....... here is the question.

1. The house is For Sale By Owner and they have had really bad experiences with realtors. They prefer to work through this without one. What all do I need to look for and make sure is in the contract so I don’t miss anything?

2. How do I look for liens?

3. Is there anything we might be unaware of or need to look out for with this deal?

I'm not sure where you are located, but if you are in title state, let your title and/or escrow company help you with the closing. They will handle the title search, HOA fees, etc... If you are not in a title state, same goes, just use a closing attorney.

1. You may want to have some kind of contingency in there for a property inspection, so that you can cancel the deal if there's something really wrong with it. Not sure about this kind of deal though, I've never moved a house before.

2. Check the city/county assessor's office. It's usually free to search and find and then they usually charge if you want a report. Check here: BP Real Estate Public Records

3. No experience doing this, so I'm not sure what could go wrong.

Are you paying the asking price for the house and the lot?

What is the flood zone of the lot?

When you say "we" estimated moving and setup costs, who is we? Was a house moving company involved in that estimate?

$130-150k seems like a wide range? What are similar aged/style 1,000 sq ft houses selling for in the area of the lot? That will help you narrow down your ARV.

To your questions:

1. Somebody in the transaction needs to know and understand real estate contracts to get those things right if you won't involve a realtor.

2. When you get your contracts with each seller (house and lot) the title attorney will do the searches for liens and other title-related concerns, not you.

3. A lot. Every usual concern and then a whole set of house moving related concerns. A very competent house moving pro, Ed Smith, Devillier House Movers, can advise you about those concerns. You can find him with an online search. My post was blocked when I included his phone number. :-) NOTE: I have no business affiliation with this person/company.

I'm really interested in how this deal turns out for you. I bought 2 adjoining properties from 2 different sellers on a side road just off of Big Lake road in Lake Charles almost a year ago. I had intentions to do duplexes on it but a motorcycle wreck in February kind of threw a hiccup in my plans. Since then I've been considering possibly doing what you're planning. I don't know anyone who has done something like that though. 

I have moved houses when I was young man in the early 80s.

The houses we bought were dirt cheap so moving them made sense most of the time.

You may need to pull permits to move power lines and whatever the house may hit while moving it.

I would make sure all is good having a bad experience could mean they are the problem not the agent.

You will need lots of permits hooking up sewers, electrical etc. that gets pricey really quick.

Have some knowledge person check the wiring, plumbing, look for lead paint, asbestos.

The drywall will crack up big time.

Check for liens might get a lawyer to help.

Honestly, if this is your first deal, I would back out.  There are way too many hazards, even for a 10th time deal.

1. No realtor. Red flag for me, as whenever I'm told they don't want to use a real estate agent, they usually have something to hide.

2. @Andy Bauman 's advice on super-using the title/escrow company for liens is great advice that should be followed.  They'll charge you more, but it's worth it.

3.  Waterfront property is always a challenge, as you have to deal with special permits, disconnecting utilities, previous water damage, etc.

3.  House removal.  Never good.  As @Billy Smith pointed out, be prepared to replace drywall.

Again, I would back out.

Originally posted by @Robert Leonard :

Are you paying the asking price for the house and the lot?

NO and NO. 

What is the flood zone of the lot?

This is an interesting development that we are currently researching. Literally half of the lot is in a flood zone and the other half is not. 

When you say "we" estimated moving and setup costs, who is we? Was a house moving company involved in that estimate?

Yes, we got multiple estimates.

$130-150k seems like a wide range? What are similar aged/style 1,000 sq ft houses selling for in the area of the lot? That will help you narrow down your ARV.

This has been difficult to pin point. the lot is in a rural area with no restrictions, However, most of the houses around are on slab and quite a bit bigger. There are a couple nice mobile homes around but all double wide. The house is smaller and on piers but as far as curb appeal it matches the neighborhood well.

To your questions:

1. Somebody in the transaction needs to know and understand real estate contracts to get those things right if you won't involve a realtor.

2. When you get your contracts with each seller (house and lot) the title attorney will do the searches for liens and other title-related concerns, not you.

3. A lot. Every usual concern and then a whole set of house moving related concerns. A very competent house moving pro, Ed Smith, Devillier House Movers, can advise you about those concerns. You can find him with an online search. My post was blocked when I included his phone number. :-) NOTE: I have no business affiliation with this person/company.

Thank you for your response!