Partner won't buy out of jealousy over what the seller will make

[Aliz Raksi]

I'm in a bit of a pickle, because my husband and I disagree over investing philosophies and whether we should invest in a particular property. We're both pretty conservative with our money and have been keeping most of it in cash because we'd been looking for a "home run", we're worried about a possible correction, and as you all probably know, deals are getting harder and harder to find. But he's a complete pessimist and doesn't want to pay for a flipped property that he sees was $180k cheaper 1-2 years ago. I, on the other hand, think that if the flipper took all the risk and did all the work, he deserves the gain, and there's still gain left for us (in the form of cashflow). 

We already own a duplex that we bought in LA in 2014, it was a flip that the seller had bought at an auction and done a lipstick job with, we put in an extra $30k to get it rent ready, redo plumbing and electrical, and have been managing it ourselves since. Note, my husband had wanted to back out of the contract at the last minute but I convinced him to go through with it, and now it cashflows around $1000/mo and is the best investment we've ever made, yet all I hear is how we could have done way better and we should've bought something like that property but before it was flipped, in a different area that had later gotten gentrified. Hindsight is 20/20...

Fast forward to today, after I've spent months looking, developing a relationship with a broker, and passing on multiple opportunities, we have a multifamily property under contract in Cincinnati, OH. According to my calculations, it's a 7.5 cap, we could buy it for $420k and rents are slightly low at $5000 gross/mo, we would be cashflowing $800/mo with $105k down and no work. It pencils out, but my husband doesn't even want to hear it, because he's jealous of the seller: he had bought the property a year ago for $240k, rehabbed 9 out of the 11 units, and is looking to make a huge gain from what we can see.

What's your advice? Pass on it, or try to convince my husband to buy like I did 4 years ago? I don't want to pay for inspections, fly out there, etc., if my husband will veto the purchase anyway. On the other hand, if I go through with the due diligence, it all looks good, and yet we back out, my broker would probably never speak to me again.

Granted, we won't be able to do the BRRR strategy with this property since there's not much value-add left (that would have been ideal). But it's a low-risk investment that would give us some stable cashflow until we find the next one. It might be worth noting that my husband would love to reach financial independence and has pretty lofty goals but no specific plans/actions to achieve it, our goal would be to find value-add properties that could give us a balance of gain in equity and cashflow.

My husband says I can buy if I find my own money. What do you guys think? Should I start looking for other investment partners? 

[Mike Cumbie]

@Aliz Raksi

I run into that mindset all the time

"They are asking $45K for it, it's a slam dunk when you are done with it. $35K in repairs and we could list it all done for $135K all day long."

"But I know he only paid $18K for it at auction, no way is he making $27K off of me"

"It is still a home run, I suggest we make a solid offer and lets close this out, I have it on pretty good authority he would take $35K cash, no inspection 2 week close"

"Tell him I'll give him $21K and not a penny more"

Next morning: "Did he take it? When can we close?"

..... "No, we heard nothing and it is in Pending"

"I thought you were suppose to find deals.... I need to find an agent with a more investor mindset who will get my low offers accepted".