May I suggest you do an archive search for GRM and Cap rate or capitalisation rate? There are some posts that will help you know in advance if it is a good deal financially or not.
That is exactly the type of property that is the hardest to sell and the hardest to finance. That means it is the type that is easiest to get a good deal on, and the easiest to get a nothing down deal on, and to get the seller to hold financing, sell on a land contract etc, in other words a nothing down deal.
Don’t let the Real estate agents buffalo you and NEVER say “nothing down” - they hear “NO COMMISSION CHECK” and freak out.
Say “low down payment” and get your own agent to represent you. It costs you nothing, the 2 agents split the commission.
Good luck and don’t be afraid to come back if you have any questions.
I am interested in purchasing a 4 unit apt. building with no money down. Asking price $245k, on market 1year+, currently under contract but no moves have been made in the last 30 days. Property needs repairs interior/exterior, and cosmetic upgrades. Neighborhood busy, relatively low crime, convient to shopping, schools, public transportation (in the city, DC, its the only way to go.). Rents range from $485-$780 per month.
At any rate I am going to persue this until I hear otherwise and I want to know which approach to take. Like I said, I want to secure this building with no money down.
Of course like most Americans, my credit isn’t gold, but it can’t be all that terrible either. Besides this is a good investment property with the potential to become more valuable within the next 5 years.
Any thoughts would be greatly appreciated!
These are the kinds of things we buy. We bought one five unit, one six unit, and one 12 unit since Janurary, all with no money down, and an annual cash flow projected from 9,997 to 27,000. The easiest way to do no money down deals (if you have somewhat respectable credit) is to find out how much bank financing you can get and write up your offer for the owner to carry the down payment.
You mentioned the property is under contract with no activity, does this mean you havent noticed any activity and the purchaser is in the process of closing or you have talked to the agent and the purchaser has not applied for financing. Dont wast your time on a property under contract. If the realtor is any good he will have made sure the buyer is qualified before he put it under contract and in essence pulled it off the market.
The other comment I would make, be sure to do good cash flow projections, purchasing something no money down withouit good cash flow is not a good deal unless you know it will appreciate in value and you dont mind spending your salary keeping your bank and tenants happy.