Neighbor's house recently boarded up! Messing up my flip!

Neighbor's house recently boarded up! Messing up my flip!

Investor · Norcross, GA · Member since 2016 · 87 posts · 20 votes

I closed on (bought) a flip a little over a month ago. At about the same exact time, the house right next door had every one of their windows and doors boarded up with plywood. As it turns out, the neighbor vacated the house over 6 years ago. I called him and asked him about the situation and he was surprisingly welcome to the conversation. He told me the city told him he had to do it or they would've done it and charged him for it. So he drove in one weekend and did it himself - and in so doing, singlehandedly brought down the value of the neighborhood by a good 20%, if not more. I asked him if he was just going to leave it like that and he said no, that he had a contractor that owes him money that was going to do it. I thought, "yeah right." So I made him an offer to purchase. He declined. Sure enough, 1 month later and nothing has moved. Still boards on windows. Meanwhile, my rehab project is almost done on my flip and I called a realtor to come look at the house. She had very bad news for me, basically saying that the house is unsellable until the neighbor does something with his house. The ARV on the house would normally be around $150k, but she said I'd be lucky to get $95k for it, and $60k-$70k would be more realistic if I were to just unload it. Those were dire numbers even in my most pessimistic days. Obviously I'm not going to do that and will probably just rent it indefinitely until this guy gets his act together. So, this is FAR from ideal... I'd rather take my flip profit and go home.

So my question is, do I have any recourse here? There is no HOA. I've called the city and complained and they said (to the best of my recollection) that the boards are not illegal, but I can complain about grass growing too high, debris, etc. So I did that (because the grass was about a foot high at the time). I've spoken to a few of the neighbors and there seems to be a petition underway. Hopefully that might start things up... but I don't know what the petition is about, and if it will actually do any good... So does anyone have any other creative ideas for this? Do I have any other recourse I could try? I called him back about 2 weeks ago to make him another purchase offer... left VM message and no reply yet... All I really need to do is put new windows/doors on so it's not so painfully obvious that the house has been abandoned... it's just a complete eyesore as-is. It can't just STAY like this... can it?

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Real Estate Agent · Las Vegas, NV · Member since 2015 · 2k+ posts · 1k+ votes
9y

If the boarded up house drops your flip $50 k why dont you just ask the guy if you can lease the house form him clean it up and sell your flip ?  

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  • Investor · Warner Robins, GA · Member since 2015 · 1k+ posts · 490 votes
    9y

    Buy the house in the low and fix/flip it.



  • Architect · Sydney, NSW · Member since 2016 · 66 posts · 38 votes
    9y

    @Eliot M. I very much like @Matthew Paul's idea of just putting up a sign to say this house will be sold soon. 

    Not sure if painted windows can deceive anyone. The house is very close to yours and it will be too obvious. It may look ok on a photo, but not in real life.

    I think you need to call this owner daily. I doubt he is such a seasoned negotiator and that he is trying to stretch the time and make you more motivated and so raise the price. This house is just not the top priority for him. He pays the bills but he does it together with his other bills. 

    Make it super easy for him to make a decision. For example, if you want him to sell it to you, maybe offer to drive the whole team to his place and do the signing there. If you want to lease for 6 months, maybe prepare a one-page contract where he can just write his name. The contract will say he leases to you the parking spot and allows to take off plywood and install windows. Then you can park your car there and the property will look occupied.

  • Wilmington, DE · Member since 2016 · 116 posts · 59 votes
    9y

    The city isn't going to a thing... if nobody is living there and it isn't inhabited, why does the city care? If the neighbor is that stubborn and isn't going to budge, cut out the headache and just rent it for a 1 year lease and see where ti goes from there.

    Battling with the city (which isn't going to do anything) and battling the neighbor (which will probably upset him more and make him even MORE stubborn) is just going to make everything worse. Rent it out, get a thousand bucks a month or whatever it is and wait a year and see what's up then.

  • Real Estate Agent · DFW, TX · Member since 2016 · 44 posts · 24 votes
    9y
    I would ask the owner for permission to maintain the curb appeal of the home. He shouldn't have issue with you mowing his grass etc. with that written consent I would mow it, pull down the boards, bring in a roll away and stick a contractors sign in the yard that mentions whole home remodeling. It might look like a dump, but it will also look like it's being remodeled like your home is. It might ease the burden on people going to view it.
  • Investor · MN · Member since 2015 · 72 posts · 37 votes
    9y

    I would not try to deceive potential buyers. You are setting yourself up for a lawsuit and it is just not a nice thing to do. I think the ideas mentioned are great, (painting the boards or replacing windows and doors). It makes the property look much better and hopefully will keep the trouble makers away, But, the fact that it is vacant should be disclosed, especially after you start to try to make it look better.  My 2¢

  • Investor · Atlanta, GA · Member since 2013 · 3k+ posts · 3k+ votes
    9y

    If this is THE realtor for that neighborhood, she might have a regular buyer ready to buy yours for 60K. Someone who does more business with her than you do.......just saying...

  • Property Manager / Investor · San Jose, CA · Member since 2013 · 780 posts · 302 votes
    9y

    I like the many creative ideas and suggestions in this thread!

    Hopefully, you can make some headway with the adjacent property owner.  

    Resorting to putting up fake signs and trying to make it appear that change is coming when it may or may not be is misleading at best.  (Though the ideas are very ingenious and funny)

    Go the extra mile and do it the right way without compromising your character.

  • Investor · Charleston, SC · Member since 2016 · 5 posts · 3 votes
    9y
    I would avoid these misleading scenarios, however creative and funny they might be, for the neighbor's house. If you share how nice, and free, painting that plywood would be then he might be more open to it. This leaves it in the air as well as far as deceiving goes- if they notice, disclose, if they don't even realize well there you go. Also, I'd like to point out how incredibly easy and painless it usually is to install windows and doors. They don't have to be Masonite and Anderson, honestly you could throw up used ones too temporarily.
  • WorldWide · Member since 2016 · 1k+ posts · 1k+ votes
    9y

    ^That. If the question of the whole deal is a couple grand to make tens of thousands extra, who wouldn't want some free windows and doors? You'll have to sweet talk the guy and maybe arrange for a happy ending or something as well...

  • Investor / Real Estate Agent · Atlanta, GA · Member since 2016 · 73 posts · 36 votes
    9y

    I can't find this anywhere in the thread: why are the windows boarded up in the first place? Broken glass? If that's the case, just replace the panes, with permission. Super cheap. If the wood dividers are damaged too, just replace the sashes. Sash kits for double hung windows are $90 - 140 each, complete. Why replace the whole window, frame and all? Are they even damaged anyway? Of course, if the owner doesn't grant you permission in writing to make repairs to his property, all of this is moot anyway.

    I don't really agree with the numbers that agent was throwing at you either. Brought down the whole neighborhood by 20%, slashed the value of your house by 50%, etc etc, seems a little drastic.  Is the house in Norcross? There are plenty of areas close by with rehabs surrounded by distressed properties that are selling like crazy; Chamblee, Doraville, etc. Of course I don't know where your house is so I can't say for sure. Have you seen any comps lately? I would love to see this for myself.

  • Investor · Norcross, GA · Member since 2016 · 87 posts · 20 votes
    9y

    @Berny Petersen the house is in Alabama. There is some law there that says if a house has been trespassed in and is vacant, the owner must secure the house or the city will do it and fine you. 

  • Investor · Jasper GA · Member since 2015 · 1k+ posts · 1k+ votes
    9y

    @Michaela G. is correct, I would get another realtors opinion.

  • Investor · Norcross, GA · Member since 2016 · 87 posts · 20 votes
    9y

    Hi everyone. This thread has gone cold so I feel like I owe it to the discussion to give an update on where I am with this neighbor of mine. I have started a different thread where I would love any feedback on my current dilemma between doing a BRRRR vs continuing with the flip option. I would love feedback on that thread, which is here:

    https://www.biggerpockets.com/forums/67/topics/440...

    But in terms of where I am with my neighbor, here's the update.

    I have been in off-and-on contact with my neighbor since I purchased my house last September.  He was initially willing to sell to me, although my price was too high.  So instead, he said that he was going to get a guy to work on it for him so he could sell it himself.  I left it at that around Thanksgiving, Christmas time frame and let him soak in that decision.  I knew he would not move on it, and that I should follow back up in a couple months.  So, my rehab work was complete at the beginning of January and I listed the house.  In about March, I was getting way less interest than I should've been, and I knew it was the neighbor.  So, I got back in touch with him and he let me take the boards down and walk my contractor through the house so I could get a quote on the rehab needed.  I got the quote, ran the numbers and made him another offer.  He declined and we parted ways for another several weeks.  Then, in April, with my house still not selling after I had reduced the price on my flip by about $40k, I mailed my neighbor a rental contract so that I could rent his house from him, and in return, I would maintain the curb appeal of his home (in addition to paying him rent, obviously).  He declined that as well, saying "it's not the money, it's the liability of having a tenant in there."  So, a few weeks passed and I got back in touch with him, asking him if I could basically get a few of my investor friends over there to see if they're interested in buying his home.  He said, "Sure."  So I contacted them and walked them through.  We structured a deal and made him an offer, and he promptly rejected.  

    So, here we sit 8 months later and $50k less on my list price. Still no interest as of yet, and I'm wondering if I shouldn't BRRRR it and just wait the guy out. I would welcome any comments over on my other thread, as I have laid out the options as I see them currently available to me. Would love any help or feedback. Thanks!

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