Looks like a good buy/hold, but....
I've got a turnkey buy-hold opportunity. Just rehabbed by an experienced owner-builder. Looks to be low-maintenance and the seller just signed a 12-month lease with a new tenant. Great, huh.
Unfortunately, the seller rented it below market...at about 0.9%. And it's in a tight market, so I don't expect a lot of negotiating leverage.
Questions:
1. Buy-hold is a long-term strategy. Would you buy a buy-hold knowing it will not cash flow the first year?
2. Even if she proves to be a great tenant, I will need to raise the rent 10% after the first year and maybe again after the second year. How much lead time would you give a good tenant when you know you have to raise the rent by that much?