All Forum Posts by: Jason K

I am in contract on a owner occupied property with Freddie Mac. The agreed upon closing date is Nov. 25, there is a possibility that everything would be ready to go by Nov. 1st, the realtor mentioned a possible incentive from Freddie Mac to close early. Does anyone know what kind of incentive or money off we are talking about. The contract price is $133,500.

Also, the house comes with a 2 year home warranty that Freddie Mac is offering on all properties, on the contract it says they are paying $1100 for this, is there anyway to opt and take the $1100 of the purchase price? Most home warranties have too many loop holes and I am plenty comfortable on working on any mechanical system, well except for hvac.

Thanks in advance

I am keeping that factor in the purchase price, but putting it in the lease as an incentive to buy.

Also 6 month lease will not have the option for a termination, but probably the option to apply the rent toward a purchase price.

Good news

We are going to do a 6 month lease and he would possibly be interested in having the option to buy in the lease.

Just need to work out the value for the building or what I would be willing to sell for.

Thanks for the help, great answers and angle that I did not see.

Yes I have considered selling them the property. I will bring that up to them this afternoon.

I agree I don't want to hold someone, especially if the intent is to buy their own building.

I love the idea of a provision for terminating the lease with 2 months notice. That would give me time to market the space and try to prevent any lapse in rent.

Thanks again

anyone

I have a commercial office building and my biggest tenant is now looking to buy their own building. They just now started looking and their lease is up and the end of July.

It will be almost impossible for them to find and buy another location in 25 days, especially since we live in a small community and there is a total of 15 commercial listings for sale. Then they would have to enter escrow and than probably remodel the building to fit their needs.

Since I don't think they could make the deadline due to the # of days left and they have a pretty big operation, I have feeling they are going to ask to go month to month.

Would you hold your guns and only offer a 1 year lease. It really straps me in terms of seeking additional financing for new property when I can't show the lender leases for my current rental property. However the possibility because of the size of their operation the building and the economy, their space could sent vacant rendering me no rent.

I am not selling it, just trying to raise the rents. I bought as fixer upper, so I am still at a positive cash flow with the new tenants. However I don't think the old tenants should get a free ride.

I bought a commercial office building about 1 year ago. It needed serious updating when I bought it - fresh paint, remodel bathrooms, remodel shared common kitchen, new carpet in some offices, tiled front entry, and just a good cleaning.

Anyways there is 3 tenants that have been in there for 10 years and are still paying the same rent. Actually I got a rent roll from 10 - 15 years ago and the rent was actually more expensive than it is today.

New Tenants that have moved in have paid a market rate.

Now that I have the building in excellent shape, what is the best way about raising the rent to the tenants that our paying a lot below market rate. Also the only leases I have our for the new tenants, old tenants on month to month.

Thanks
Jason

It does pencil out to be a good investment. It just does not meet your 2% rule, however the 2% rule in my estimation cannot be found unless you go to less desirable neighborhoods with less desirable tenants.

With the 2% rule, I would be asking to be it for $72,500. Which if you can let me know where to buy 10 year old duplexes in good condition and a good neighborhood, sign me up.