Deal or no deal?

Question

Hello,

I am trying to decide to purchase a pretty house that is in a great neighborhood but at market value.  The house is a 3/2 and 2 car garage, brand new hardwood floors, built in 2003, fireplace, gourmet kitchen, low HOA, no CDD, community pool nearby, family friendly, and in an area with lots of new construction and development.  The problem is the seller wants market value, ARV.  She is a FSBO.

My exit strategy is to do a purchase lease option.  So, after the purchase of the house, set up a tenant/buyer to pay 10 percent as the non refundable option consideration and after all is said and done a $300 cash flow each month. (PITI, PMI, HOA fee, 5% vacancy all included in the rent).

Question: Would you buy a house like this at the market value?

Joe Fairless · Answer

@Pennie Nakashima I wouldn't settle for this place if you can't get a good deal on the front end.

Pennie Nakashima · Answer

Thank you Joe for your reply.

Pennie

Pennie Nakashima · Answer

Thank you Steve for your reply.  It makes sense.

Pennie

Steve Vaughan · Answer

When every house in the country is available at FMV, I guess the only variable is the lease option.  Since it will be you doing the lease option, not the seller, I'm not sure why this house would be chosen over any other house available at FMV.  In real estate we have to buy right.  Give the seller some time on market to season.  Don't fall in love with an investment property.  She 'wants' FMV.  Time may make her 'need' a quick sale.  NO - DO NOT BUY AT FMV unless the terms are fantastic.  There are no terms here.  Good luck!