Looking to buy and landlord is looking to sell

Buying & Selling Real Estate
6yFollow

Looking to buy and landlord is looking to sell

Ben Capriolo
New to Real Estate · Member since 2019 · 7 posts · 0 votes

Hello,

So my year lease is coming to an end at the end of January 2020. I have now decided I would really like to own my own home, which I plan to eventually turn into my first investment/rental property. So I'm going into this purchase considering it to be my home for a few years and then a rental afterwards.

Now, the situation....

Im currently looking through the market and really just waiting on a home that catches my interest and demands. The problem is my lease ends in January and one of my roommates doesn't want to renew or go month to month. Ive talked to our landlord and it seems as though if we don't renew or stay in the house, he would like to just sell it. Now, I think this townhouse would be a great purchase but I've already got prequalified and for only around $165,000. Ive briefly discussed with my landlord that I am looking to buy and he said he'd be interested in selling and told me that he thinks the house would be about $200,000 (which I agree is probably FMV). I told him what I was qualified for and said he wouldn't be able to go that low.

Now, Ive read a little about lease-to-buy scenarios but don't know too much. Would this be a situation to where it would work in both sides benefits?

I would really appreciate any type of input or suggestions as to what I should consider.

Any other ideas?

Thank you so much for your time!

Ben Capriolo

0Reply
20 views

2 Replies

Jump to latestLatest
  • Colin Krieg
    Member since 2019 · 1 post · 0 votes
    6y

    My first question would be, have you looked at anything else? Or have you only been looking online? 
    Second question is, if you plan on keeping it as a rental after, have you done the math? Will it cashflow with how much you’re putting down with someone else paying the same rent as you are?

    0Reply
  • Jason Turgeon
    Realtor · Boston, MA · Member since 2019 · 244 posts · 275 votes
    6y

    You can't afford to buy this house as a personal residence, and you don't have a plan of any kind to make it a profitable investment. You have 4 options:

    1. Go out this month and find $35,000 cash to make up the difference (down payment assistance from family, etc.)

    2. Get a better paying job in the next couple of weeks that allows you to afford a $200k mortgage

    3. Move somewhere you can afford. 

    4. Convince one of your other roommates to go in on this with you, buy the house together as co-owners each owning 50%, and hope that it works out. I have 2 sets of friends who have done this successfully, but it is generally a risky proposition to go into a major purchase with a friend unless you are very sure it will work out and also have a predefined way to get out of it without hating each other if something goes wrong.

    I'd say you are looking at option 3, but maybe the first 2 options are available to you. Since you can afford to buy *something,* just not your current rental, you should be learning about house hacking as a strategy to boost income and reduce expenses in the place you move to next. There's tons of advice on here about what makes a good house hack.

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free