To Pop the Top or Try to Setup a Deal for an Investor?

[Brandon Henry]

I am in a unique situation. I have a few options available to me and I am trying to figure out which option to go with. I am looking for feedback from those that have gone through my options available. I am in the Denver, CO area in Platt Park, which is a very "hip" area for young families or those trying to start a family. Below numbers are rough based on speaking with my real estate agent.

My Situation: I do not have enough DTI available to buy the neighbor's house nor fund the construction phases for Option 1.

Option #1:

Short Description: Buy the neighbor's house and pop the top and dig the basement out and sell each as separate units.

Issues: Funding to buy the neighbors house/popping the top/digging out the basement

Rough Numbers: My house 370k, neighbor's house 350k-450k, Pop Top on both 125k-160k, Dig both basements 80k-100k, Finishes - 50k-100K    Total Cost - Roughly 1,150,000 

Potential Reward: Selling each unit around 750k-900k Total - 1.5M-1.8M 

Option #2:

Short Description: Ask the neighbor how much they are willing to sell their half and wholesale their half and my half to an investor.

Issues: Finding out what the neighbors are willing to sell. Finding an investor that has the money to buy both units.

Potential Reward: Get the investor to buy both halves and provide me 150k for setting up the Deal between the neighbor and I.

Guidance Needed: Where to start on finding the funding for either option. Looking for books, people, place to go to setting up the right deal for either option. 

I can provide more information if needed. Let me know what you all think!