Should I do this????

[Kyle Clevenger]

Hello BP Community!!

I am a licensed realtor in Indiana, I currently only have one rental property, but I also manage a couple of others for my family. I have had a potential opportunity present itself to me from a family friend, and client I am assisting in the purchase of her new home. Details to follow, the numbers are not exact:

My client owns her current home, which has a little bit left on the original mortgage. She has elected to purchase her new home NOT CONTINGENT upon the sale of her current home. She has told me she would be happy with around $100,000. I explained to her we would likely be able to list for around $140,000 due to comparable houses listed in her market. I also explained that listing could take some time, due to buyers, the current interest rates, etc.

I may have an opportunity to purchase this property myself using a private investor. The private investor is family, very cooperative, and not charging an obscene amount of interest. Based on the current condition, I estimate about $15,000-$25,000 worth of work needs to be done (depending on the quality of materials we could use as well as the possible layout changes). Market rents for the area are between $1,300 and $1,700. (Large gap I know, but some additional factors influence this). 

I think I may be interested in BRRRR(ing) this property for my own portfolio, but I obviously want to make sure I am taking care of my client first and foremost. I have not done much due diligence yet, other than some preliminary looking around and discussing the listing of her property.

To be more clear, if there is not a problem with me presenting an offer to my client for myself to purchase, the opportunity would resemble the following:

Offer owner $100,000 cash- which she could utilize in the purchase of the new property.

Extend the date of possession to allow her ample time to move.

Follow a budget of $15,000-$25,000 for renovations/repairs. ARV estimated to be around $150,000-$175,000.

Either sell the updated house for $150,000-$175,000, or implement BRRRR for rents between $1,300-$1,700.

I apologize for the sloppiness of this post, I had only short time to create. I do look forward to hearing what the community thinks!

Best regards,

~Kyle