Buying a House From a Friend to Turn Into a Rental

[Justin Nienhaus]

A friend of mine is selling their personal residence.  They know I have a rental and asked me if I was interested.  The property would make a decent single family rental.  Not spectacular, but it shouldn't be hard to rent out, especially in Minnesota where the vacancy rate is crazy low.

My concern is making the numbers work without losing a friend.  The numbers can work, but this is a business.  I would likely offer less than market and I think they may have purchased early after the crash (not the top, but certainly not the bottom).  I don't believe they are underwater, but they may still be below purchase price, even at market.  

Is this worth entertaining?

[Josh Mitchell]

@Justin Nienhaus Yes, it is worth entertaining. They asked you if you were interested. I would just come back with, "yes, I would be interested, but I would only be able to offer XX in order to add it to my portfolio." It may give you an idea of what they are thinking and you may be able to negotiate a little with the price. Just one way of going about it.....