Hello,
I have wanted to invest in real estate for years. I've been reading forever but have never taken action. I finally sent out yellow letters a few weeks back. I got a handful of replies and one "motived" seller. I think there is too much risk in this deal but would appreciate opinions.
The house has been on the market unoccupied for 2 years. Owner paid 205k in '08. He has no equity, owes around 180k. He recently took it off the market so I imagine I can at least get 170k now that he doesnt have commissions. His payments are $1560 plus another $73 for HOA. He is willing to do a LO. Comps in the area average 163K but there are many with 1000sqft more with updates selling for less. His has new carpet and newer shake roof but 80s appliances, formica, and original fixtures. I seriously dont think I can cash flow. It is in a good school district and the neighborhood is desirable. Homes on the lake sell in the millions. It sits on a golf course and owner feels that this makes it worth his asking price. Plus he has had a few offers in which the contracts fell through making him think he may get what he is asking.
Is it possible to structure this deal? According to Wendy Patton's book I could get 10% for lease option premium. 4% Expected appreciation (I asked a successful local inventor) And negotiate equity buy down.
Thanks Jo
