All Forum Posts by: L. Brown

I am under contract for my first home, which is a duplex. I found an attorney and realtor that I felt comfortable with and seem to know the process well. I have some concerns about the advice I’m getting, though. During attorney review, the seller wanted to put in a contingency that said if items were not up to code they would not fix it and that if issues with the house weren’t a safety issue they wouldn’t address it and it couldn’t be a reason for me kill the deal. My attorney thought this was fine, but I didn’t like this so I asked her to push back and strike this. She did, and the seller agreed to remove this clause from the contract. They were trying to get the upper hand.

In a separate instance, the inspection showed some significant issues. My realtor said he spoke to the seller (who is a realtor) and she said she would give me a $5k credit. My realtor thought I should take the deal right away, but I wasn’t sure how much it would cost to get the repairs done. He said he didn’t think I needed to bring my GC in, but I decided to push and do it anyway. It seems like the repairs will cost $7k- not far off, but more than the $5k the seller was offering.

In both of these cases I am wondering if I have an attorney and realtor that are looking out for my best interest. What do you all think? (PS- they do not know each other, I found them independent of one another)

@Greg Scott what group did you join to learn the right way to buy properties?

@Brennan Hile Great point, I also asked about being able to Airbnb the basement and that said that’s illegal too (I’m in NJ). If I were to rent the basement out and get caught, the biggest downside for me would be going cash flow negative by not being able to rent out the basement. It blows up my whole idea of house hacking.

I recently experienced something that I’m wondering if others have experienced. My goal was to do a house hack where I lived in the basement and rented out the other units. I found a duplex I like and began the process for getting it under contract. I went to an investor meetup and as soon as I told them I wanted to rent out the 2 units and live in the basement they told me it was illegal- that I was operating it as a three family. I called the town the next day and they confirmed that it was illegal for me to live in the basement, even if I was the owner. After talking to a few more people about it, they said this was not unique to that town, that using the basement as my living space would be illegal regardless of the town. It was curious to me why I had never heard this in the books I’ve read or podcasts I’ve listened to. It’s always been spoken about as if it was fine. Unfortunately, I’m back to square one with how to get into real estate.

Has anyone experienced this?

@Seth Williams thanks, Seth! With respect to due diligence for the basement, what kinds of things should my realtor look into? Anything that is particularly important to consider?

Hello, BP nation! I am under contract on my first house hack (and first home purchase)- hurray! It's a duplex with a tenant in one of the units. My plan is to live in the second unit, have the basement finished so I could live down there, then move to the basement so I can rent out the second unit and completely cover the mortgage. I need to get my GC to walk through the space with me but from looking online, it may cost at least $35k to finish the basement. I'm thinking about how I would use the space once I move out.

Option 1: I could do a basic finishing (to make it live-able) and when I move out, make it a part of the first floor unit rental or Air B&B it
Option 2: Alternatively, I could “go big” with the basement and try to make it a three family (obviously this would require approval from the city).
Option 3: something else I haven't thought of

I'd appreciate your thoughts. Thanks everyone!

@Don Konipol I’m a newbie- can you explain why there’s no deal here?

@Lola Brown the ask is $460k (over valued for the condition its in). He bought it 19 months ago for $335k

@Chris Hopper thanks for your reply. I was thinking the same thing about it being an opportunity, but have been getting a unified no... this would be my first property so I don't want to screw it up (too much). The ARV after renovations is about $520k.

If this were you, how would you structure the deal? Owner occupied? Master lease? Something else?

@Joe Villeneuve thanks, I definitely have thought about moving on, I just don’t want to miss an opportunity and the right deal can be hard to find in my area. But you might be right, especially for the first one.