FSBO trying to sell house for 4yrs - How should I handle it??

Question

So I contacted a FSBO owner today.  The “house” is a double wide that has had additions added to it and sits on 10 acres.  The inside of the home is very dated (wooden toilet seats, early 90’s cabinets, etc) and was built is in 93’.  2 beds, 1 bath. 1,194 sqft.  Lots of makeshift storage on the lot (chicken coop, garden shed, etc).  Lot has 2 wells and 3 septic tanks.  Located not to far from a new developing neighborhood.

Owner is asking for $189,000.  County tax appraisal office values it at $158,212.

Saw pics of the house online, and plan on visiting it later this weekend.

Owner is 70’s years old, and wants to retire and move to Arizona.  She has been trying to sell the house for about 4 years now.  People have looked at the property (buyers with hired real estate agents) but she informed me that no one has made any offers.

Does this sound like a motivated seller?  It seemed to me she was.

Any suggestions on how to handle/negotiate with an owner who has been trying to sell their home for 4 years now?

Thanks.

Thomas S. · Answer

Don't make an offer....ask her what the lowest amount she is willing to sell it for. Tell her you will think about it. Wait a few days and, assuming the price works for you, offer less than the number she told you she would take.  Negotiate from there or walk.

Obviously if she is a dreamer you walk away.

Chad S. · Answer

@Luiz Souza

I just got off the phone with her again.  I am going to take a look at the property tomorrow.  I am leaning that this IS going to be a waste of my time, but I am going to use the time to get me some self education and practice in the following:

1.  Get some experience in talking to sellers

2.  Practice asking the right questions (motivated/unmotivated)

3.  Figure out estimates for rehab while doing a walk-through

4.  Make her an offer (never know what she'll say)

5.  Learn from my mistakes

Everything around it are homes on very large lots and those homes are not MH's.  Still trying to run the comps and ARV around the area.

Chad S. · Answer

@Jay Hinrichs and @Thomas S.

So I spent a good hour or so at the property......let me share my adventure with you.

See the pics of the home here:      https://imgur.com/a/fMiBLhp

So the property has be owned since 81.  The original MH burned down to the ground sometime back in 87 from the wood stove.  However, a part of the bathroom was saved, and was added to the rebuilt home (around 93').

The owner has a two RV lots (in OK shape) and a MH in the back in bad shape.  One RV slot is being rented out to a guy for $100 dollars a month in a rough looking travel trailer.  The additional MH is being rented for $400 a month.  The lady that lives in it has about 10 cats and two dogs and has been living there for 8 years.  She is on a waiting list for section-8 housing and her brother died in the MH about 2 years ago from pneumonia.

I was shown two water tanks that were installed in outside sheds (with no insulation), with just a little electric heater running to keep it barely from freezing.  They were installed about two years ago.  The two septic tanks are about as old as the property (25-30 years).

We spent a good amount of time talking about her garden and the trees she planted and looking for fresh chicken eggs (we found 4 eggs).  There was about 20 chickens running around, and she has been trying to catch them and butcher them for the last year.  Her husband tries to shoot them out of the tree but misses, she informed.

The sheds that are spread out store various junk and chicken coops.  I wouldn't classify the house and its surrounding sheds as a hoarder home, but maybe organized hoarding......???

I spoke with the husband, and they are wanting to sell as fast as possible.  They plan on moving into their travel trailer and seeing the country as soon as the property is sold.  I asked the women what she plans to do with all her stuff, and she just wants to get rid of it and call the Salvation Army.

Both are tired of taking care of the lot, and said it is becoming to much to handle.  Lot is paid in full.  Owner knew the property tax, electric, and misc. costs to run the home/lot.  She is 77 years old and still is working, husband is retired.

I asked her what price she was looking at, and she told me $189,000.  I told her I needed to run some numbers and would get back to her.

After walking the property, my wife and I agreed if the property were to be bought/sold, everything on it would have to be demo'd.  The trees are mature and could stay.

I would say, from all the details I gave above (and even left out) these are motivated sellers.  I did get clarification from the husband about how long the house has been for sale and he said 1 year, not 4 years.  There was a language barrier over the phone with the wife, who is Filipino.  The wife also said I was the seventh person to see the home in a 3 month time period, but no offers have been made.

After seeing the pics I linked above and what I shared do I:

1.  Run raw land comps, adjust for demo and profit and see if I can make an offer and sale it?

2.  Not waste my time and move on.  Is their potential here?

Sorry for the long post and thank you for reading.

Chad S. · Answer

@Tom - Thanks for the advice about not putting out an offer.  I was thinking about this pretty strong tonight.  You put me into perspective.  I am still new at this game.

@ Jay - I did look at raw land comps near the property (there is a few around her place), and they are waaay under her asking price.  My thought, if it was to sell, the MH would need to be demo'd.  The land itself looks in decent shape with mature trees and the like.  Its funny you mentioned "heirs".  I thought to myself this evening, she'll be pushing up daises when her kin sell it later down the road.

I really appreciate the advice.  I will defiantly give you guys an update on what happens tomorrow.  Glad I checked the thread before bed.

P.S.  I am not a poet =P

Jay Hinrichs · Answer

sounds like land value only minus cost to demo it.

so look at raw land comps and then back out demo and your profit.

NO one is going to pay that kind of money for an old MH.

its only going to sell if the land is worth it minus demo.

plus a buyer would have a heck of time financing it.

In my experience the person who buys this will buy it from her Heirs.

Chad S. · Answer

Will do.  Thanks.

FSBO trying to sell house for 4yrs - How should I handle it??

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