Buying a Condemned Pooplex

[Erik D.]

Hi everyone,

I am interested in purchasing a condemned property. It is a duplex, but I believe the proper term would be pooplex. The water is shutoff, so squatters have been ******** in pots, soup cans, and the floor.

I believe the ARV would be 105,000. The list price is $65,000. I want to offer $30,000 though since the list price seems too high for such a massive clean up job.

There is trash everywhere. Code violations. Rotting food. Did I mention poop?

Someone could easily put $100,000 into this property. I am aiming for $40,000 to $50,000. It is located in Saint Paul on a main street. It has a two car garage in the alley but no street parking in the front.

Electrical is newer, heating is electric, two water heaters look great, but the place needs new flooring, one new bathroom, some work in the kitchens, and lots of cleanup.

My goal is to purchase with hard money, rehab it, place tenants, and refinance. Then, hold for about 5 years.

Why do you think the seller wants $65,000 for this dump? They are tax delinquent and will eventually have the property taken away I believe. Is offering $30,000 an offensive low-ball?

Thanks for looking!

[Elizabeth Wilson]

@Erik D. - Who cares if they think that the offer is "offensive"?  If that is what you want to offer them, go for it!  These are the types of houses (foreclosures) we end up with as well.  

I'm sure you have already taken this into consideration but just in case:  have you included the costs of bringing the property back to non-condemned status and removal of code violations?  I've not dealt with that, but considering what it costs in Memphis to return a property's utilities on after a year, I'm guessing those types of things aren't cheap.

But if your numbers work, then by all means submit an offer.  They will either take it or not, and if not, then there are other deals out there (and hopefully ones not quite so gross!).

Best of luck!  Let me know how it turns out!