All Forum Posts by: Chelsie Runnings

My landlord has just notified me she is considering selling the property I rent from her. I would like to approach the subject of seller financing with her as a possibility of buying the property but I am not sure of how to go about this.

The property is located in Sonoma County, after the fall fires we have a severe lack of inventory and houses are flying off the market far over asking price. What can I do to sweeten the idea of owner financing. This is a property that she inherited from her parents with no loan owed on it. Also, it has a total of 3 units on it. 1 primary house that I live in, and 2 others that had previously been garages and converted to 1 bedrooms many years ago and have also been rented out. I have lived here for going on 3 years and have a good relationship with the owner. I am not ready to take a home loan. I work full time but pay is inconsistent because I am also a Realtor so some weeks my full time job as a paralegal is not always 40+ hours a week, due to needing to focus on my Real Estate work. 

Can anyone please give me some advice and also some guidance on approaching this situation?

@Jay Hinrichs what area of Hwy 175 are you referring to? I graduated from Middletown, Grew up on Cobb Mountain. I am interested on your take of the fire there increasing the housing. My Family moved out to Kelseyville instead of re-building, I don't get up there much more than a monthly visit these days but always interested in what's happening there. I did have a listing over the summer and was actually very surprised by the interested there was for it. @Brian Burke I'm planning to attend next months Sonoma County Investor Meetup, I am expecting it to be very informative with the Director of the Permits and Resource dept. as the guest speaker. 

@Brian Burke thank you for input. I have not personally dealt with anything having to do with Coffey Park, however I just asked some lenders and other realtors who have been working with clients what their experience has been, that is where I got that Permits pricing from. I had thought that number was high but had not done enough research to confirm.  I know they had waived fees for a short minute and then decided to reverse that decision, but was not sure what the pricing was after that. I know in Lake County after we lost our homes in the Valley fire in 2015, due to the extensive damage under ground from how hot the fire burned it was basically starting over from scratch, septics, Water etc. the fees were enough to stop all 7 of my family members from re-building. 

Gallaher Homes who will be building new homes in Coffey Park, is projecting a cost of $280/sqft, however I have yet to see if that is actually what the price is, again this is what I have gathered from talking with those who have been dealing with this first hand. 

I am curious to see how your partner will fair in the end. Again, thank you for your input. I appreciate your take on it and sharing your knowledge on this. 

Hi Kristy F., I am a local realtor and have a few clients who lost their homes in the fires and have been considering purchasing a Coffey park lot and building. After doing a bit of research and talking with some colleagues about this, in all honestly I don't think it's the best decision at this time. The numbers just don't add up. A local reputable builder who is doing new homes in the area is projecting a cost of $28/sqft. Assuming you build a 1,500 sq foot house that building cost alone is $420,000. Then factor in $100,000 for fees, permits and connecting utilities. Add in the cost of the lot which are going for $130,000-$150,000, you are already at $650,000. This doesn't include landscaping costs. Another thing to keep in mind is Santa Rosa is facing a shortage of construction materials and labor so it's very likely you will be spending over $700,000 to build a new home in Coffey park. This is why I say the numbers don't add up. Bottom line, there's a ton of risk involved and you'll need deep pockets to deal with any issues to complete construction. Even if you built it for $700,000 it's likely the resale value won't be worth $700,00 for Coffey park at the time of completion, eventually they value should catch up, but that probably won't happen for years down the road. I know you have a contractor who is ready to do the work at a lesser price but how low will he go to make it worth it for it after all is said and done?

Jay P. There are other areas in lake county beside clearlake. Such as Middletown, Kelseyville and Lowerlake. Also look In Shasta county, such as Redding.

Hi @Natalia Katoaka! I'm a little late in seeing this post, sorry about that. I know you were hoping to be completed by 12/1 so I'm a day behind that but hopefully have a bit of info that can help you. It sounds more like you have created a junior accessory dwelling unit which is a bit different than an accessory dwelling unit in the terms of size, juniors are no larger than 500 sq feet and is created using an existing bedroom. These are relatively easy to get approved for, if you would like to just have the peace of mind. They are typically done over the counter at the County Permits department and typically only need building permit. Junior units are not separate dwelling units and don’t require building or fire code upgrades or separate utility connections. 

As far as renting to tenants, just go with who you feel would best fit. Ask for references and credit reports. Be firm on your rules, such as no dogs, and have a solid rental contract put in place. Also, just a side note, majority of the "price gouging" cases that have been reported to the DA have been dismissed. So as long as you are staying within 10% of the average rental price you will be just fine. If I can answer any questions or help you in any way, please let me know. I'm in Sonoma.

Hi Tracy P. It sounds like you made a great investment with that property! I have some buyers actually looking to buy something on some land and build a couple small units and turn into a bed and breakfast. I was thinking of you as they were telling me this. I live down on Broadway but my office is on the plaza. Really is a fantastic location! I love the convince of being so close to the plaza but I'm just out of town so I feel like I'm in the country.

Hi @Tracy P. Welcome to BP. So nice to connect with you! Kudos to you on getting through all the red tape and making your lot work for you! Your House sounds beautiful! This Valley is Hot! I am seeing properties move just days after hitting the market. Between your Use Permit AND your current LEED gold house, you have some great value on your hands. I agree 100% with you on marketing it as residential with the possibility of making it commercial use later down the road. sounds like your property may be located somewhere just off the plaza or Is the house located where it can be permitted for vacation rentals? 

Hi Cath T. Congratulations on passing your RE exam and your pending sale! Great idea working with one of your agents to help you write the contract. You can learn so much from a seasoned agent, no two contracts are the same, and on your own sale contract even! Bonus! Best of luck to you in all your future endeavors!

Hey @Antoine Martel, Nice to connect! Thank you for the fantastic input. I will defenitely be checking out these groups!