Should i buy this house?

Question

It's Single Family Home, 2500 sqft, 4 beds, 2,5 baths. Need cosmetics, new paints, carpet, flooring, new windows. Listing price is $194,900. ARV is $212K. Owner previously went thru bankruptcy but she stated in disclosure that it's been discharged in Aug 2015. I am not quite sure if this is a legitimate sale?

Steve Vaughan · Answer

Sounds like a lot of house.  I spent that on mine, but it had a mother-in-law rental attached that brings in $600/mo.  My goals were to invest all available income into RE and my family's future.  I can do that more when not saddled with a fancy house early on.  Tons of forever in the rat race folks with fancy houses in my neighborhood.  Live a little like no one will, a lot like no one can @Katie Do!

Adrian Stamer · Answer

To live in? Doesn't seem any upside for investment

Steve Vaughan · Answer

$174,900 sounds a lot better than $194,900!  Curious to come back with rising price each time.  Be sure to have her buy good Owner's Title Insurance for you. Good luck with your purchase @Katie Do!

Jeremy Dolan · Answer

Sounds like you have your game plan all figured out. Sometimes you have to take a little risk for a larger reward. In your case it seems that all the numbers are in your favor, I vote for yes.

Katie Do · Answer

@Steve Vaughan Thank You Steve! I know she is motivated seller. She is actually  owner/ listing realtor as well. She have tried to list this house for sell like 3 times within the past 12 months at $174,900, $179,000 and $190,000 and now $194,900. Since her bankruptcy is discharged now,  she said she could sell the house now with clear title.

Steve Vaughan · Answer

Oh gotcha @Katie Do!  That sounds like a much better idea investment-wise.  House hacking can be a great way to build both momentum and future tax-free appreciation.

Even if you are buying at FMV, if this is the house you like in the neighborhood and school district with upside, it may be a good move.  If you have the ability to get a loan and buy with cash, you may be better off finding a motivated seller to obtain instant equity if you have the time and patience.

Any listed property in about any market can be purchased at FMV. We seek bargains!

Katie Do · Answer

@Steve Vaughan: Thanks for great advice, Steve! This one has mother in law plan plus a study on top of 4 beds, I was planning on renting out the other 3 rooms. so i can get additional incomes to start on RE.

Katie Do · Answer

@Adrian Stamer: Yes to live in

Should i buy this house?

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