This FSBO has all the makings of a deal, right?

3 Replies

Hello All:

An attorney has 2 properties FSBO as he is tired of dealing with college student rentals, an area I specialize in as I rent to about 70 college students.

He currently rents Property #1 for $1050 (I can rent it for $2000) and he rents Property #2 for $1050 (I can rent for $1500). He is asking full price to sell them and I don't ever like to pay retail, but know there is vast spread to make between what he rents it for and market rent.

I've approached him about doing a lease/option from him that allows me to sublet and even with me paying 6 months of rent upfront. He seems somewhat flexible but prefers to sell outright. Does anybody have any suggestions on how to get this done? I have heard about wraps and sub-2's but don't know much about them. There has to be a way to make this work, right? Any help would be appreciated!

Here are some other details on the deal:

Property #1

Asking Price: $100,000

Est. Value: $100,000

Est. Mortgage: $78,000

His current monthly PITI: $875

His Rent price: $1050

My Rent price: $2000

Spread for me: $950

Property #2

Asking Price: $100,000

Est. Value: $95,000

Est. Mortgage: $70,000

His current monthly PITI: $825

His Rent price: $1050

My Rent price: $1500

Spread for me: $450

Don't see a deal here, as he's asking FMV. A sub2 is probably out, as he's an attorney and will know all the traps/risks a typical uninformed seller wouldn't.

If he wants out, he has to be willing to budge on asking price.

That's how I would keep trying to play it for now -- negotiate hard to get sale price down.

@Chris G. Thanks, Chris. It's going to be tough because he seems to be a pretty cheap guy. He's an attorney and was at the house cleaning it himself. He has no idea about highest/best use of his time.

@Wayne Brooks I definitely don't ever like to pay FMV, but was thinking it might be worth it if I could net 10k/year in profit. I've offered to lease Property #1 for 3 years and pay him $8,000 a year (with lump sum payments of $4,000 every 6 months) and I be responsible for all repairs. He said he would consider it...