These are the key factors you need to be sucessful in the model you propose.In addition, simultaneous closings (where you use your end buyer's funds to close your purchase transaction - using buyer C to close the A-B transaction) are very difficult at best these days due to the many law changes and the title companies not insuring the transactions or willing to perform such transaction.

A 2nd drawback is the fact that you are often limited with making any improvements.

Now, you may be able to improve the property in some way and raise the value.

I had been working with the seller on the price and was able to get $5000 of the asking price, had the house appraised, talked to the property manager on how to improve the property, talked to Lowe's about screen doors, and made numerous trips to the house.

In the Madison, WI area, I think we've past the bottom and we'll see some improvement in pricing and sales this year. :) More on my thoughts here: http://wp.me/p1dbYY-7V

As Rich pointed out, things change and it's rare that an area actually improves over time if it was a mature area...but there are some, they usually decline.Most who hold SFD rentals I know flip the inventory 7 to 10/12 years staying away from many of these issues.

It seems to me that anyone holding properties long-term would end up with dozens and dozens of depreciation schedules over the years for all sorts of things that would be considered "improvements".

Then hold the lots until things improve.

I can't think of a third but welcome all suggestions and even improvements to my first two offers.1- Seller finance - 0 down for 15 years.2- Work with the bank to assume the loan and pay the seller $5000. 3- ?????

I will still talk with my attorney to see whats the easiest for him to perform but at least I now know what to ask him.