Unusual/Unique Properties (tough to sell later?)

5 Replies

I'm looking to buy and hold something as a house hack. I've come across some properties I consider to be unusual and unique. For example, one property has 2 living units, a 3br and a 2br, plus a home office with a separate entrance. Each living unit has separate driveways & garages. This property is actually incredibly perfect for me while I live in and house hack. My primary concern is that it will be incredibly tough to sell down the road. How many people are out there looking for a property that is a 3br unit, a 2br unit, and a home office, right? I'm just trying to figure out how to factor this into the equation. I suppose it could certainly take longer to sell, and thats fine, but, I'd be concerned that the pool of potential buyers would be so small that it could be subject to severe downside price volatility (aka just not being able to find a buyer at a fair price, forcing me to discount it)

Are these concerns valid, and how should I approach this situation? Thanks 

@Michael Hahn unusual properties do sell at a discount typically, but you can normally find comps for them. Here in Chicago we see a lot of houses that are set back on the lot where the garage is for instance. These types of properties always sell at a discount compared to "normal" houses even though they rent just like a normal house. 

I would focus on your hold period on this one. If this could be something that you could hold for 5-10 years then it may not matter. I also would think through that office. I bet you could monetize that when you move out. I know office space can almost always be rented out to someone looking for a small business spot on the cheap. 

@Michael Hahn - Many times the term I have heard thrown around for these properties is being functionality obsolete.....meaning the layout is not set up to function like a typical house and thus becomes either very expensive to fix or obsolete.

Where are you looking for properties?

@John Warren Thank you for your reply. Why do you say if hold period is 5-10 years it may not matter? I presume that you just mean as long as I don't need to liquidate it quite quickly, that it will sell eventually at a fair-ish price. Is this accurate? 

@Michael Hahn if you hold the property for 10 years then you will probably cash flow really well and see appreciation. Real estate is very forgiving and even if your property is not super traditional it can still do well long term through cash flow and market appreciation.