Should I buy it before it hits the market?

Question

I have the opportunity to buy a 3-bedroom duplex (6 bedrooms total). I'm in contact with the listing agent but my realtor thinks I should let it hit the market. I've been 0/5 due to this being my first real estate purchase. My goal is to house hack. I personally believe I will be outbid and get into a bidding war if it hits the market. Plus, I'd have to do a hard money loan likely. I love the place. It's being listed for 300k but want about 325k if I buy it before. There's just nothing in my area and it's hard to find side-by-side duplexes with attached garages let alone a 3 bedroom in my area. It should be listed next week. I realize I basically have no leverage but if they are willing to sell it before it hits the market I think I should buy it.

What are your thoughts?

Mike Dymski · Answer

If you want it, the numbers work, and the market value is $300k, send a written offer for $300k (not $325k).

Hard money loan is short term financing...not owner occupied long term financing.

Account Closed · Answer

If you can’t qualify for a loan with your personal income and use your personal savings for a down payment then you should pass. Save up and when you have those things in place you will be ready. Not what you want to hear but it’s what I would tell my kids.

Zane Cress · Answer

You should absolutely not do a hard money loan for this. If you can't get approved for this as a primary residence with a FHA or some other low down payment loan then you have a few issues that need to be resolved before you buy a property. You either need to sit back and save more money or find a lending partner that can get you approved for a conventional 30yr. Your realtor is correct if they want you to offer above what they plan to list it at then you should wait. If they expect a bidding war and it doesn't happen in the first 5 days then you can approach the deal with leverage on your side.

End of the day if you really like the property and can make the numbers work then go for it. It's your journey. But don't fall in love with a property just because it's your first purchase, be patient, be smart, don't lose money.

Justin Moy · Answer

When you say "I'm in contract with the listing agent" do you mean you signed the contract without your realtor representing you as the buyer? If so, that is likely why your realtor wants you to wait so that he or she can write the contract otherwise they don't get paid.

Realtors get paid when their clients buy, so there has to be a reason your rep doesn't want you to buy it now. When I was a realtor I always wanted my buyers to preempt properties so we had a higher chance of getting the deal and they had a higher chance of getting the property they wanted without a bidding war.

I would also follow the advice about hard money in the thread, not sure why this property can't be an FHA loan

Erik Estrada · Answer

Hey Joe,

Not many hard money lenders will lend on a property that is intended to be owner occupied. Too many regulations to protect consumers turn off a lot of hard money lenders from doing it.

Why can't you buy this with a conventional loan? a solid LO can close in 14 days, which is typical for most hard money lenders anyway.

Should I buy it before it hits the market?

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