What would you do?

[Sharad M.]

Hello all,

What would you do in the situation? The property is a 3 unit and each unit is 2/1. Two of the units are rented out for $525 each with tenants paying the utilities (except heat for one). The third unit is in really good condition and ready to be rented out. The property is listed for $59,900.

The issue is that the property is listed as a 3 unit in the county's website, but I called the city planner and they said that the property is zoned as R2. I asked them if they come out to inspect the property to see if the property conforms to zoning requirements, and they said no. The issue will come up if the place were to burn down and I wanted to rebuild, I could only rebuild it as 2 family house. Based on the comps, I made an offer of $25,000 cash offer because there was 4 unit house that sold not too far from this one for $30,000, but it was a foreclosed property and needed work. The owner came back at $55,000, and I went back with final offer of $30,000. The owner came back with $53,000. I told the listing agent that the property is zoned as R2 and it's not really a 3 unit house. It can be an issue anytime.

Now my question is, would you guys pursue it any further or let it go?

Thanks for all the help!

Edit - I should add that the property has been on the market about 3 months, and there was an accepted offer on it that fell through because of financing.