How to Offer on Retiring Landlords 9 Single Family Rentals

[John Suralik]

I am in the early negotiations with a retiring part-time landlord to buy his entire portfolio of nine rental houses. His wife and my wife were talking and she shared that they are looking to sell all of their houses because they are getting too old to manage them. I have never negotiated anything close to this, but last night I dug into the numbers and analyzed each house. I wrote down rough estimation of rent for each and what my offer would be on purchase price. I have a lot of due diligence to go to research rents, expenses, cashflow, taxes, insurance, and purchase price. I'm working on having 75K down (HELOC from my primary) and I am going to ask him to owner finance the rest. I'm thinking about what his needs might be. What if he doesn't want to be locked in for more than 3-5 years, is adding a ballon payment clause after 5 years to risky? I emailed my RE lawyer and I will post her reply below when she responds as well, but I would love to here your experience with owner financing, adding protective clauses for both parties, or purchasing multiple properties at one time. Thank you in advance for sharing.

[Jerry W.]

Sometimes in trying to buy multiple units do a single bid for all.  If the Buyer has a much higher price, ask him to write out what he thinks the values are for each property and maybe it can help you get a deal on one or more of the gem properties.