All Forum Posts by: Page Huyette

I'm looking at a duplex zoned for 3 units with a nice comp next door. The duplex is a SFR turned into a 2-unit in a great neighborhood. The 3rd unit would be freestanding off the alley where the oversized garage currently sits.

I'd like to purchase the property, rehab the front units to increase rents and value, and go right into construction of the third unit. I can come up with the down and some of the $ for the rehab. Would this be a good candidate for hard money financing? I know hm is usually used for fix and flip, but this would seem to be a property that hm might work for. I would talk to my local lender first to make sure my financing exit strategy would be sound with them.

Option #2 would be to convert the front unit into a sfr and resell, or convert and add the smaller unit and resell. Any thoughts?

I got a contact from someone I crossed paths with who had an older farmhouse up the way moved about 18 miles and the cost was $16k with the understanding that you had to watch the guy closely for add-on costs. I'm using that figure as a jumping off point and have my eye on a vacant lot close to the original location of the house.

House is free (owner originally tried to get $$ for it and kept falling through) and I'm still researching the vacant lot, which is owned by a business acquaintance of mine. This is a classic story of cobbling together several networking connections and keeping my eye out for opportunities.

The approach would be to purchase the lot using hard money, move the house, rehab/repair and sell.

Bumping this topic since I haven't seen a lot on BP about this. I'm considering moving a 2-story early 1900's house about four blocks away in the same town. Current foundation is rubble, no chimney and house is a long rectagle with a bump-out room.

@Geof Greeneisen mentioned drywall repair at wall seams and around door frames. Anyone ever moved a lathe & plaster? Other success/challenge stories appreciated!

I am also self-employed, and closed a loan last year using two year's prior tax returns, as I hadn't filed my taxes yet. It was not a problem. You may want to offer a P&L as an option to show income if you haven't filed yet.

Am also doing a refi as we speak, and even though I've already filed 2012, the lender is requesting 2010 and 2011 tax returns. It depends on the lender. The most important point is whether you are able to repay the loan regardlessof what your taxes are showing.

I've had an eye on a nearby property for awhile, and recently checked the tax records. The owner lives on the other side of the country and the taxes are delinquent on this property as well as another in town. He appears to own about 6 or 7 properties in the area, two of which have a PM listed as a contact address, with the others showing his mailing address.

I'd like to send a letter to the owner with the intention of finding out if there's an opportunity to purchase now or in the future.

Does anyone have a script or advice on what to say in this letter so I don't offend or turn him off?

True, Ben. Couldn't you say this about must duplexes? Maybe this is where my personal exit strategy needs development.

Yowch, needed that wake up call. Thanks.

Any thoughts on how to present this option for an MLS listed property so the seller will even consider it? My feeling is that if they have listed with an agent, they aren't savvy about other options, which is where the opportunity to educate comes in.

This is my inexperience showing through on seller financing. Still trying to develop an approach that makes the benefits obvious for both parties.

I'm assuming less than 10% down with the owner not having a current mortgage. Not as a wholesale property, just looking at exit strategies down the road if necessary, but the plan would be to hold.

Front house is in a historic district, so that's another constraint--thanks for mentioning. Also didn't think about 60% including the water, but that makes sense. I did account for that in my analysis, as well as snow/lawn, etc.

The primary reason for seller carry is the low down, so I can keep cash for repairs and other investments that may come available soon. Deals are nearly impossible to come by in this area, so I tend to look at properties with potential that need work and will rent easily.

I'll also run the numbers with nothing down and higher rate. Have also looked at conventional financing, as I may be able to get it for 20% down instead of 25% since its classified as a single family, but again, prefer to stay more liquid.

Thanks for the replies, I appreciate your experience and insight.

Would appreciate a review of this potential deal.

Duplex (2 on a lot) 3/1 House built in 1900 with large kitchen, finished basement

Back unit built 1998, modern 1/1 open floor plan with radiant heat, heated 2 car shop/garage

Asking price: $299k
Offer of $225k max, owner carry with $15-18k down, 3-4 year carry amortized over 30, refi into conventional.

Potential rents: $2300 mo (ballpark low market): 1400/900. Tight market, so could go for $1550/975+

Separately metered for gas/electric

Master water meter (considering a submeter)

1 block to active, desirable downtown area & close to university. Current town vacancy rate 2%

Front house needs approx 15k work. Could be phased.
Back unit needs some kitchen cab work, about 1k, maybe add a 1/2 bath upstairs where bedroom is located.

Owner has indicated they may be willing to carry (some?) for a short period. Can't get any more details from the agent but I believe they own free and clear.

DOM: 45 +

Flaws/reason not under contract: No outdoor/yard space due to construction of 2nd unit makes it unsuitable for nice owner occupy or family rental, front house is old & scares those not comfortable with rehab, on a busy street (but 1/2 block to city park, pool, library, downtown). Suitable for grad students, young couple, college students. Easy curb appeal with basic exterior upgrades (deck, fencing, etc.)

Seems like a great buy & hold rental. Exit strategy would be to sell as a turnkey investment or lease option if necessary.

Thoughts?