Whew! That’s a nice portfolio. It’s that way here, a 2 bedroom TH around here would rent for $800-$900+util depending on area, and 3 bedroom house (we have very few 2br) rents for $950-$1200 depending on area. Now take the fact that THs sell for roughly $50k less then SFRs, and the other fact that you can get $100-$200 extra for a lease/option, and you could really have a good thing going, especially if you give a small rent credit (making your T/B less likely to exercise.) Every year or two you could have a new T/B in there with a fresh option fee and higher purchase price.
And if they do exercise? Take back a 2nd for the difference and continue your cashflow for several additional years. If they default you can take the place back and start all over
I have motivated sellers calling me but not with SFHs, they are calling with 2 bed 2 bath Townhouses. Are townhouses a good way for a newbie to start? I have been told that renting a Townhouse is much easier than selling,… Is this true? ( I don’t want to be a landlord) I do however want to be a Bank! (smile)
I can get this one Townhouse “Subject to” but need to know if these Townhouses are good for a beginner, especially if I want to sell to my buyer with owner financing for a monthly cash flow, some upfront cash and a back end profit!
I live in a hot market, with a growing population. People are always looking for places to live.
Should I do this? The loan that I can take subject to is equal to what the townhouse comps for.
My market is hot, and as single family homes have become more unaffordable the townhouse and condo market has really heated up, more and more, because that is the only choice for many first time home buyers. So as long as its a good buy, good area, etc. why not?
Why don’t you run an ad saying you have 2/2 Townhouses for sale on owner-financing, and see what response you get? Say “I’m sorry, but they’re all sold! However, we buy more all the time, can I get your name and number?”
Then you’ll have a list of potential buyers ready to buy your next purchase.
One Canadian guru has bought over 1000 properties and over 800 of them were condo townhouses. He claims he can rent them out for nearly as much as a house but he can buy them for a lot less, therefore he always has better cashflow even in ‘hot’ markets.And they go up just as fast or faster, on a percentage basis.
He likes to buy and hold but if you like to resell quick I expect you can sell them quicker than a house because they are cheaper and easier for a broke person to buy and carry.
The holdup to me would be the 2 bedrooms which are less popular than 3.
Why would you need 2 bathrooms in a 2 bedroom house?
