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So...I’m new to BRRR’s, Flips and anything other than syndication deals! I was literally walking the dog, staring at a house that was definitely in the state of being moved out, inquiring with my wife, “Wonder what the heck is happening here?”, when the owner walked out of nowhere and casually asks, “You guys wanna buy a house?”
Yeah...that’s exactly what happened and upon taking an impromptu tour, she told us her whole life story ending with how she is eyeball deep in debt, trying to fix the house up to sell...and ran out of money. (Long story short...it was her mom’s home and she used the majority of the equity to pay for assisted living until her passing.)
-2 BR and 1 BA on each of two floors
-Zoned as duplex with separate entrances, but bottom floor needs a kitchen
-Everything it needs to be “move-in” ready is purely cosmetic, i.e., flooring, paint, landscaping, etc.
As stated in the report (link above), here are some interesting factoids:
1. Owner wants 375k, but totally negotiable
2. Owner owes 240k to the bank
3. Owner desperately needs 18k by Sept 1, 2019 to pay off a hard money loan
4. Roof replaced Jan 2019
5. All windows (17) replaced April 2019
6. Interested in Owner Contract if terms are good (wants to be paid out after remodel and refinance)
One of my goals is to incorporate local, multi family and long term real estate holds for passive income in my portfolio. This neighborhood is in the Olympia WA, 98501 SE division...super sought after for schools and location.
Is this a no brainer?
Best structure for owner contract?
Negotiating tactics (that are fair to the seller)?
Thanks in advance for anyone’s opinions/help!
If a 6% return is cool with you, then it's good.
Thanks for your input Anthony. I may be able to squeeze out a higher return based on how well I manage the remodel. Again, new to this part of RE investing and looking for advice.
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