Newbie with possible red flags on property?

Question

So my husband and I are brand new, I mean we only started looking at the possibility of buying and renting out properties seriously in the last 2 months. We found a very small house (2 bed 1 bath) house for $47,000. We drove by the house to see it in person first and found several sort of big things wrong: the gravel driveway was more grass than gravel, the back yard was about 20 feet from door right up to railroad tracks, and (BIGGIE) my hubby went around the back and saw char on the back of the house, seemingly from a fairly recent fire (which wasn't disclosed on realtor (dot) com of course). We figured that we could talk down the price for a lot less than they put it up for, since it's only been on the market for 1 day only. I called up the real estate agent listed and it turns out it is the agent's personal property he's put up for sale. He said that since Illinois has a law where you can't broker your own property, we had to find ourselves an agent and he would work through them.

Firstly, I'm not understanding because isn't he still technically brokering it himself? Secondly, is this a huge red flag? My husband thinks it is and we should just back away from this property. The guy is licensed, it's just his property. But the fact he didn't already have another agent list the property is a little sketchy. I'm too green to know if we should back away. It'd be a really good place, minus the train tracks, but if we put up a fenced deck in the back it'd be easier to rent it out if we do go for it, as it'd be safer for animals and small children. Any advice would be appreciated!

Account Closed · Answer

@Melissa Leo He is allowed to list his own property he just cannot be a dual agent and represent both himself AND you in the transaction since he is the owner of the property but he is allowed to represent just himself. nothing shady about i,t he actually told you so that you would have fair representation so he did his job right and legally.

Brandon L. · Answer

@Melissa Leo

I would ask yourself this questions:

1.Who do I want to rent my house

2. Who will most likely rent this house

This property sounds like a place that the probable renters will be the people that have no other options, and to me that is the biggest red flag. I like tenants that do not give me problems.

Nobody WANTS to live close to train tracks, No one WANTS to live in a small house. They live in these places because there is no other choice. Walk away from this one and find a home your ideal tenant WANTS to live in.

Melissa Leo · Answer

I think I see... so it would be he would work through the agent we get so instead of seller-agent-agent-buyer it would be seller-agent-buyer and it would be 100% okay? (Apologies for my greenness showing, I've only ever gone from living with my parents to renting from landlords, I've never even thought about buying a home/multi-family to fix up then rent out myself til a couple months ago)

Account Closed · Answer

@Melissa Leo Yep! Its totally ok, thats what bigger pockets is for! Ask away. You just have to find an agent yo represent you and the seller will represent himself since hes licensed. This will also be all less confusing once you get an agent too and they walk you through the process with your interests in mind.

Roger W Leo · Answer

Hello everyone

@Sara Bradford Thank you for the response, im the hubby lol, If the char marks were localized then i could assume that they were maybe from a grill to close or something. Seen plenty of melted soffit and siding from that. The siding seems very new and the spot that i was able to see the char marks is on a ledger board on the back of the house meaning the house at one time had a deck. so thats a little suspicious to me but could be nothing.  @Wayne Brooks We understand it wont stop the noise, heck concrete wont stop the noise lol,  but it was more for the point of safety for small children and pets. The back yard is only about 20-30 feet deep before the incline that the train tracks are built on and it is a working line with several trains a day. The back door is elevated as there was once a deck so we were thinking a large deck  instead of a tiny back yard. But another thing we will also need to look into is building codes as being that close to the tracks may be the reason the deck was taken off in the first place.

Wayne Brooks · Answer

A fence isn’t going to stop the noise from the RR tracks.....people live next to the tracks but it will Always be at a discounted rent and you may likely get tenants who take it because they can’t rent anywhere else....bad credit, evictions, etc.  Think about it, who would Choose to live next to the tracks?

Melissa Leo · Answer

@sara

@Sara Bradfordundefined Thank you so much for your input! We will definitely keep that in mind if we decide to continue following through with this property :)

Sara Bradford · Answer

The red flags are more concerning than the ethics of the realtor. :)

1.  Driveways are relatively inexpensive to pave, so that would not be a major deterrent to me.

2. Is the train line running? How often? Noisy properties generally won’t get top rent, so when setting rent you will likely need to take this into consideration.

3. Could char be from a BBQ too close to house? We charred our bricks after leaving grill on for hours by accident. Took lots of elbow grease but we got it off.  At least he is the owner - so you will get an accurate answer if you ask. If there was a fire, I would be suspect.

4. If you consider making an offer - hire a really good home inspector.

5. My rule of thumb - trust your gut!! If one of you is weirded out - Run.

Newbie with possible red flags on property?

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