I'm a member of a local REIA and am not sure what to do on a potential deal based on the advice I received from said REIA last night.
I do extensive marketing and received a call from an out of state absentee owner who wants to sell his property. The property is currently being rented by longtime tenants. This homeowner is NOT overly motivated to sell-- no issues and the property has good cash flow. They just are getting older and not interested in having the house anymore.
The price that the owner wants is $150K. The home has no issues, has a new roof, a new fenced in yard and is being leased by a tenant for another year and a half. Cash flow is about $350/mo after fees (including property management). It's on a cul-de-sac in a 10 school district. Homes in the neighborhood are selling for $95-$105/sq ft and at 150K, this would be at $79/sq ft.
So after running all the numbers, the only recommendations I was given were not something the seller would be interested in. I don't want to give up on the deal and wanted to know what you all think about doing a straight option? If I've learned anything from retail real estate, location, price, and condition sell houses and this home has all 3. It may not be the best 70% ARV-repairs deal, but its definitely a deal. What do you think I should do?
And by the way, the seller has already agreed to let me put an option on it if my investors don't make them an offer they want to accept. Any help?
Can you buy it yourself ?
@Caleb Heimsoth : I'm not interested in buying it. Want to just flip the option and move on. What are your thoughts?