Need help/advice fast please---House hack opportunity!

[Tim Ball]

Need to know what to do here. Time sensitive.  Your advice/help would be much appreciated. There is a duplex for sale in a great area that I am looking to buy and live in one half.  The price is listed at $240k.  It is very well maintained and no major renovations are needed.  Basic cosmetic stuff, but not necessary.  One side is being rented right now at $1150/month.  This is at bare minimum $50 under market value. Probably could get $1250-1300. It is a  1571 sq ft 3/2/2 each side.  Mirror image.   Taxes are $4,800/year.  

Should I:

1.  Buy this deal at all? If yes, why? If no, why?  Thank you.

2. Buy this deal with hard money?  I can call it a cash deal to the seller and we can close quick, so I can hopefully get it for cheaper and close quick and then refi out of hard money loan. Only thing I will need to put 20% down, which is hefty for me right now.  

3. Buy this deal conventionally?  This would most likely not get me much of a discount on the deal but I would be out of pocket much less, if I put down lets say 10% down.  Its a hot market and I am guessing I will be competing against multiple buyers.  I need an advantage somehow.  

[Mindy Jensen]

@Tim Ball I also live in an ultra-super-hot market. My experience is that top dollar wins. I have lost deal after deal to better offers that can close in 10 days. If you have a super hot market, you aren't going to get a deal, no matter how you pay. If you are competing against multiple offers, you have to make the highest offer. 

I lost out on the duplex next door to me because the seller needed cash as quick as possible. Whether you offer cash or make an offer contingent on financing, the seller still walks away with cash.

I like the idea of hard money to get the deal so you can offer a quick closing, but most likely, the seller with go with the highest offer. You can always put in an escalation clause, where your offer tops the next highest offer by $XX. You put a cap on it, so you don't end up offering $1 Million for a $240K property. With an escalation clause, they have to show you proof of the next highest offer. 

But beware - a savvy agent/seller can just counter with the escalation clause removed, and bump up the price to the highest price you are willing to pay.