All Forum Posts by: Sage Baca

I’m in the negotiation stages (using a real estate agent) of a property I believe will make a killing via Air BnB once its fixed up. Here are the details:

Prop originally listed at $400k, then $375k, then removed from listing after 9 mo. I met with the sellers personally and got the impression their real estate agent advised them to sell to a cash buyer (assuming a bank wouldn’t finance d/t to the property condition). My “unprofessional” opinion was that the property didn't need so much work that a bank wouldn’t touch it.  But I could be wrong.

Offered $340k (original list price was $400k). Seller’s accepted and agreed to seller financing, then changed their mind because I could only put $10k up front, with an additional $50k pending the sale of my current home.

We countered with the conventional route (which saves me a lot of capital) and are back and forth about inspections. I agreed to pay both well water/sewer, but asked the sellers to pay for any repairs if any were needed.  They offered up a max $2k allowance for repairs.  

We did not accept this offer, and now they are talking about seller financing again. 

My question is, how can I make this deal work? Who can I bring along to help me figure out if there will be any issues in these areas? Would an appraiser or inspector be able to tell if there were any real issues with water/sewer/structure? 

FYI, if this property (with 2 buildings) is fixed up, I believe the ARV will be around $525k-600k. Cosmetically, I plan to put in about 75k. It should rent as a vacation rental for $9k-$10k/mo (cash flow $3.5-$4k/mo).

Lauren B

Thank you for all the insight!  I had not thought of some of your suggestions, so I appreciate the input!  I don’t believe the RE agent is an idiot, I just know perspective is highly subjective and since he has never done a renovation before, I thought a contractors opinion would be more accurate.  A hoarder house can look beyond repair until all the superficial junk is moved out.  Just wasn’t sure if anyone had experienced a situation where “not worth rehabbing” turned into a 10-25k fix.  If I stand to make 250k on the deal then a terrible kitchen and a 10k lot split might be minor issues.  

If anyone has had the same experience I would love any insight.

Hi all! Major newbie here with tons of questions on a possible stellar deal- Gonna set this up bullet point style and try to keep it concise.

Deal Details: 2.88acre property (desirable mountain area near golf course).  2 homes Zoned R2 single family (for the one property)-confirmed with area lender that these deals are commonly financed. 2 homes, both roughly 3bed/2ba 12-1500 sq ft renting for $700and $745 currently. Both tenants want to stay (most likely wouldn’t once rents increase.  Great rental market.  Seller asking $185k cash offer preferable.  Per sellers agent, “one home is not worth rehabbing.  Kitchen floor falling into oblivion.”  My request to see the property will only be granted if an offer is submitted sight unseen.

Plan A: Fix and flip both homes, split the lot into two, current market supports a 200-250k return on BOTH!

Plan B: BRRRR and increase rents to market value, $1200-$1500/Mo EACH.

Questions: 

*How do I get around financing difficulties if properties are in substandard shape?

*Would hard money be the way to go even if I joint venture with someone who can front the down payment?

*Should I submit an “all-cash” offer contingent on financing and inspection even tho I don’t have the financing lined up yet? 

*Should I get a pre-approval run by my lender just so I have that to show the seller? Along with an offer with contingencies?

ANY advice, recommendations, etc. would be greatly appreciated.  This is my VERY FIRST potential deal