Opinions On This Potential Deal?
Looking to buy my first rental property and hoping to get some input from the board.
It is a 7-unit (3 duplex, 1 SFH) property. Six units are currently rented . Seller moved out of state and is asking $250,000 (been on market 6 months).
Gross rent: $3500/mo
NOI: $2300/mo
Cash flow: $720/mo
Seller was asking $260,000 and recently dropped the price by $10,000. He is selling it himself and ran an ad saying any reasonable offer accepted and willing to finance.
Seems like some potential here - motivated seller, decent cash flow. Am I missing something - like why has no one touched this in 6 months? Any suggestions on how to proceed? I'm thinking of a target price of $230,000 - not sure how to structure the financing. I do have access to cash for a decent downpayment, if necessary.
Thanks...been lurking and enjoy reading all the input. [ Edited by TCDollars on Date 06/11/2004 ]
i'd make an offer contingent on inspection and whatever else you require. You've got to be carefull...If you think there's a catch, there probably is one. But even so, the deal might be workable. Be a detective and keep your escape hatch in sight
is this property in Chicago? If so what neighborhood? If so I gotta tell you unless there's a major catch someplace I'm not seeing at this price I'd be down there with a full price offer ASAP. Put in a mortgage contingency for 80% of your offer with a 90 day contingency period. Find the glitch after you have it under control. Any one of those two flats should be worth that much.
if you don't have a friend to help in the area, rent one.
find a realtor that works on rentals often. a condo king type is good. or find the owner of a similar property to give you a hand if you buy him lunch.
chip[ Edited by 3qu1ty on Date 06/11/2004 ]