Posted by JoeKaiser on June 03, 2002 at 11:32:08:
The city demoed the house . . . they don’t do that for nuthin. In fact, we tried to get on the bid list in our town because from the numbers assessed, them demo guys make out like bandits.
A house of 1800 sf . . . I’m guessing there’s a $20k demo lien against it as well. Heck, it’s $1k just for the HazMat inspection around here. If they find asbestos or something nasty, prepare to pay double.
Joe
LAND for pennies…OPTION a vacant lot? (long) - Posted by Redd(CT)
Posted by Redd(CT) on June 03, 2002 at 10:31:36:
Last year I was driving down the street & I saw a vacant house. The house needed a full rehab. I contacted the owner & she said I can have it for $1.00.
Too good to be true? As we got talking; she said she was behind in the mortgage a couple thousand in back taxes. She filed bankruptcy 2 years prior.
After thinking about it, I left this one alone. One year later I call her back out of curiosity. This was last monday. She said the City knocked down the house & all there is is the vacant lot.
I asked her if she would be willing to give me the lot. She said yes…for the back taxes owed. She said there is no mortgage b/c the house is gone.
So, I have been scrambling trying to find out the value of this land & I am getting #'s between 24K & 40K. Definitely worth my while to get involved.
BUT, here are my concerns:
Here is my take:
Option this land w/ this seller for about 18 months (PLENTY of time to find out what I need & test the waters)
What do you guys think?
appreciate it!
Redd
Be careful of title… - Posted by Jess_MA
Posted by Jess_MA on June 04, 2002 at 22:27:18:
Hi,
I would be very careful if I were you. I don’t think the old lender is out of the picture, unless the town officially foreclose on the previous owner. Otherwise, her old mortgage may very well still be in effect. I would advise you to check with an attorney. A lot of real estate attorney offers free initial consulting. I wouldn’t do anything to the property until I make absolutely sure that I would get clean title.
Secondly, you won’t have any problem building on the size lot you were talking about. As long as the comparables in the area is around the same size lot, the value of the property should hold.
Third, have you start considering building costs? In Mass, it is generally around $100-150 per sq. ft. What have you budget for construction cost? Maybe you would want to go with a pre-fab home, cost may be $50/sq ft.
Hope this helps:) Email me if you still have other questions, love to help. By the way, which part of CT are you located?
Jess_MA
Re: LAND for pennies… - Posted by D.P.Roberts
Posted by D.P.Roberts on June 03, 2002 at 11:43:08:
I tried a raw land option once a few years ago and made a good profit, so I’m optimistic about this kind of deal. Mine was on a rural ten acre lot, though, not what you have here.
If the answers are no to these questions, I would certainly urge you to consider it.
Are the expenses involved like the tax lien a significant percentage of your operating capital?
Does the property have to resell quickly or can you wait for the right buyer?
Is the downside risk going to make you lose sleep?
And to be prudent:
You might try asking some builders whether the lot is too small to interest them rather than relying on a realtor’s opinion. Our boys out here would build on a cow if it would stand still long enough, but that’s that “different area” thing again. And this does strike me as a tiny lot. Zoning is also worth looking into before proceeding.
I would also want to learn more about the current status of that old mortgage.
Best of Luck
D.P.Roberts