How to initiate conversations with vacant house owner?

Question

I saw a house in a nice neighborhood that looks kind of outdated. Upon looking through its windows, it even seems it’s vacant. What are the steps folks have succeeded with in meeting the owner and then finding out whether they are interested in selling or not?

Nathan Gesner · Answer

@Stephen Chu just be yourself and be honest. Tell them who you are and that you are looking for investment opportunities. You noticed their vacant home and would like to speak to them when they are ready to sell. I would avoid getting too detailed; leave them wanting more.

The key is being prepared to provide options so you can solve their problem. Some people don't know what to do with the house. Some are desperate to sell and pay off burial or medical expenses. Some homes are inherited by multiple family members that hate each other. Some are sad at the loss of a loved one and unable to enter the home or even think about it. Some are greedy and want far more than it's actually worth.

Be a problem solver and you'll do well.

Frank Chin · Answer

That's very common. I looked into this issue early on when I tried to buy distressed properties. Look up the public records to see who legal the owners are. It could be one of the following:

1. The owners passed. You'll have to check the local probate court and get the name of the executor or administrator. You can check for living relatives but often they are not executors and administrators who can deal with you.

2. The owner or owners are in a nursing home or recovering from extended hospitalization. The owner has no outstanding mortgage and taxes are paid. My mom in law is currently in such a situation. She was released from the hospital two years ago, stayed with us for while, and now across the country in San Francisco taken care of by her daughter. We're in NY and so is her home, My wife does bi-weekly trips to sweep the place and pick up the mail. My MIL just got a diagnosis she's got cancer and six months to live, but the family decided not to tell her. She did her estate planning years ago, did real estate investing with us and her son, and left the home to her youngest daughter in her will.

Now, how do we respond to anxious investors like yourself? My MILs been saying she wants to go home and we told her "as soon as you'll get well". She's 94 years old. Are we going to tell her not only is she not getting well, but she'll die in six months? We're not even sure she'll be dead in six months, as my dad had pancreatic cancer, lasted three years instead of six months to a year that doctors gave him. His property was left to my younger brother and he only sold it when both of my parents passed.

In these situations, persons left properties in the will gets it "tax free" upon death, as is the case of my wife's sister with my MIL's home, and my brother inheriting my parent's home due to it's stepped up basis. We got notes from investors and so did my brother back then, we ignored them all as it's inappropriate in these situations to tell the owner "you'll be dead soon, and I just can't wait for my money". But it makes more sense tax wise to wait. But for anxious investors like yourself, we just don't know how accurate the medical diagnoses is. So we can't tell you "check back with us in six months".