Looked at a 4/2.5 house in a very good neighborhood. They had been renting this house for $900/month and the tenant has moved so house is vacant. When the seller called me she indicated she wanted 139K for the house. However I think the house might sell for 110K if she used a realtor.
When we met with the seller to look at the house and I asked her what she needed, she seemed a little more motivated. Said her husband wants to keep it as a rental but she wants it gone. Told me to make her an offer. She said she might consider selling on contract.
I'm thinking of offering to buy on contract for 102K with 2K down and monthly principal and interest payments of $600 and a balloon payment in 2 years. Equates to 6% interest amortized for 30 years. Insurance and taxes would be an additional $150/month. (Our cost $750/month.)
I believe I could resell on contract for 120K with a down payment of 5K and PITI payments of $900. My concern is that there aren't lots of folks in our market that can pay that kind of monthly payments.
I'm interested in your thoughts on this deal. Thanks!
The deal has to be more than slightly attractive to buyers in your market. If you think that will be difficult to flip, don't do it.
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