Screwy Deal Analysis..

[Ed L.]

A new triplex came on the market today.

1br/1ba kitchen and living room per unit. Each apartment rents for 400 per month.

Previous landlord paid water and maint.

Built in 1978, Brick exterior, Central H&A, good roof, and a good B location (Neighboring property are sfr).

It is fully occupied.

Asking price is 49,000... Gross Lease 1,300

Seems like a solid deal, but there are a few draw backs.

1) It is in a flood plain, although I didn't see any evidence of flooding.. "Just had a tropical storm" Extra insurance expense.

2) The current owner acquired the property through tax sale.

3) The previous owner(Tax Defaulter) has still been managing and collecting rent on the property that he no longer owns... I think he may even believe he still owns the property... Very puzzled by this after talking the the LA... I met with the tenants and they were pretty pissed at the guy for leasing them property he doesn't own.. They all wanted to continue leasing though.

Making things even more complicated is the fact that the Previous Owner, still owns a duplex that is basically on the same lot "Must have different deed/legal/tax id"

What should I be looking for with a property that was acquired through tax sale???

What all contingencies should I put in my offer that are specific to the situation?

Thanks for the help and guidance.