Financing a property that I am fully aware is over market value

[Jacob Barnhart]

Yes, I am looking at offering on a property that the owner is asking far too much for. I have a personal reason for wanting this property that most people wouldn't, so it has more value to me than most other people. Specifically, it has a large shop that I can run my personal training studio out of instead of paying $1,500+ a month for commercial space. That said, the property still cash-flows without the studio (after renovations).

Since I obviously will not get full financing on a property being bought over appraised value, this is my question: Could I submit an offer to the seller for the lesser of: the asking price or the appraisal price? This way if the appraisal comes in lower than the asking price, I would just get it for appraised value? I've never heard of offers stated this way, but I'm thinking it could be a great option.

I believe there's a good chance the seller would go for it as well, because I've been talking with her for a while and I got her down 20% from asking price, but her children convinced her out of selling for that price. She wants me to have it. I just need a good way to get the property under contract that makes more sense to her sons who just don't understand how overpriced it is.

[Brian Ploszay]

First advice, this is less of a real estate investment because you have emotional attachment to it.    And it is business real estate.

Here is what you can do:

1.   Negotiate hard in the beginning to give you the best price you can get.

2.   Make sure that your contract allows for a mortgage contigency.  

3.   Once the appraisal comes in, show it to the seller.  Say this is what you'll pay.   You'll probably negotiate something off the price.   If not, walk away from the deal and tell them he will run into the same situation next time as well.