A friend of mine that out of State and the tenants ruin the property and owner asks me to sell. The property is 3/2, 1300 sqft with no garage/carport, window ACs, Owner replaced roof 2016, updated electrical with permits, updated kitchen, replaced flooring, painted but the tenants been living there for 3 years, ruin the house so the house is not liveable.
The owner bought it at $75k cash in 2016, rehab $50k, Now their expectation is to sell for $180k with strictly AS-IS. They do not want seller financing.
Rehab it to the liveable conditions, estimate cost at $15k the market price could be $200,000-$220,000.
Fully renovation and updates, estimate cost at $20k-$25k, the market price could be $250,000-$270,000 with the current local market.
With rehab to bring to liveable condition, it could rent for $1500-$1600/month.
What is the opportunity for this one? How to structure this deal?
My idea is buy it and rehab and rent it. I plan to offer:
1, Cash $140k
2, Or seller financing $180k, with $100k down and $80k 5, year seller financing. Then I will see how the owner response.
Please advise and how would you do ? thank you so much.
First of all if the house is tenant occupied, I don’t think you can sell it out from under them because of current regulations.
The SAFE thing to do is get an OPTION for $120,000. Then market it for $180,000 (after tenants are out) with the agreement that you will get paid $10,000 to make your option go away so they can go to closing.