Hi all, my wife and I are at odds. She has a family member who is looking to unload a second home that's worth roughly 400k. They would let us take over the remaining mortgage of 215k @3.75%. It needs some updates but the home is good condition on the lake. I want to buy and hold and rent or possibly flip and sell. My wife does not want it as an investment but t ok live instead and do repairs while we live there. Our current home has 200k mortgage @3% is a 4 bed 2.5 bath 2000sqft. The new house is 2500sqft 2 bed 2 bath. What would you do? Lastly there are no rental single family home comps in the area of the potential new home.
#monroe #michigan #noob #secondproperty
seems like a no brainer if you buy it and flip it and make a quick 50k would the family member be upset. ?
Also what does #monroe mean at the bottom of your post dont get that .
This is the easiest subject to deal it seems. Do make sure to do your due diligence on other possible liens, have them sign a disclosure outlining the deal and get a power of attorney to handle the mortgage (s).
rennovate it, sell it for full price, be done.
And they are selling you the house so you can re-sell it and make a profit on it, or are they selling you the house so you and Mrs. can have a nicer summer home (an improved life).
Because if it's #2 and you turn around and sell it...you probably won't be getting a birthday gift from them ever again.
Seem's like taking advantage of your relatives niceness, if they don't expect you to sell it.
If you tell them you intend to re-sell it does their price change?
@Jay Hinrichs monroe is the city.
@Scott Mac that is the million dollar question. That has not been discussed about how they would feel about us turning it into an investment property. They are my in laws cousins.
@Jacek Blaszczyk it's all how you lay it out to them. If you can explain a sub-to clearly and are willing to cover the payments whether or not your buyer does it's an easy pitch.
I wouldn’t want you and your wife to be at odds. If you want me to take over their payments so that you do not have to focus on hard decisions feel free to PM me. :-)🧐
Can your current home cashflow as a rental?
And then move to the lakehouse and fix it? You get the investment property. Your wife gets her lake house. Win win.
Hi Jacek, Sounds like you have a great opportunity to walk into some instant equity, providing that it is in the neighborhood/city you want to live in. If that is the case, my Bride and I would rent our current home, move into the new one with about 200k in equity, fix it up, add a few bedrooms, with 2500sqft you should be able to. Then we would use the equity, either a HELOC, or refinance, to pull money out to buy more rentals. This looks like a blessing if the area is right.
@Jacek Blaszczyk , how much equity do you have in your house? Is there a reason you don't want to move to the lake house?
First order of magnitude: happy wife, happy life.
Second, don't look a gift horse in the mouth. Meaning, whatever you want to do, make sure the gifting party is alright with it.
Beyond that, there are a lot of missing details here. Can you afford both houses? Can you sell your house for a profit, or renovate it first and sell for a profit (make it the flip) and live in the lake house? Do you want to live in the lake house? Is your wife happy to stay put?
I see this less as a deal analysis on the property and more of a deal analysis on your needs/desires.
I hear lake house, and wife that wants to live there, and immediately think fix it up as an Airbnb. Rent it as a vacation rental, and you and the wife and family can enjoy it as well. But this takes management and a lot more upfront capital to not just renovate, but also furnish the property.
@Jacek Blaszczyk You can get documents prepared for loan payments with legal counsel. Ensure there are no liens other than the mortgage. Have a title company review your documents, so that when you decide to sell; you have the authority to do.
You can sell to the end buyer right away if you like. Maybe in the goodwill, you can even give a portion of profit to the person who gave you property as a Christmas gift or something pricey and nice item too.