Did you say the 154K the seller is asking is also what he owes on the house? If so, then what is the current value of the house? If it’s close to 154K, then the seller should be paying YOU to buy this house.
Remember, if he had to sell through a Realtor, he’d pay commision + closing costs. But if he’s stuborn, you won’t get a dime. Still, should you be paying him ANYTHING? Not unless the difference between 154K and the current value is at least equal to realtor commision in your state. (What city and state are you in?)
Ok here’s some numbers
154k for the house this is what the seller owes. The seller says he’s only covering cost.
seller wants 10-8k upfront
428 insurance annualy
taxes are roughly 600 annualy “does that sound right”
seller will finance at 0% for two years
And I talked with a real estate agent today that told me SFH prices haven’t been increasing for the past year or two. I’ll have to confirm that with several other agents.
My ideas were to do it as a lease option. Find a tenant-buyer that can cover all or nearly all of the upfront money payment. The average rent for a house around here that’s comparable to this house is 925/month. So charge the tenant buyer 950/month with the option to purchase at 154k in 1 year. Maybe I should ask for a larger purchase price but I don’t know because houses haven’t been increasing in value recently? Although this would be a very small profit on a lease option it’s a decent profit on it considering that someone is willing to pay that monthly rent and take care of the house because they are potentially going to buy it.
What would everyone else do?
I would actually like to make it a student rental because it’s so close to the campus. But I would need to finish the basement and that would cost roughly 6500. Then rent it by room but I don’t know if there’s a way I can do this because it’s zoned so that you can’t have more than 3 non-related people in the house. BUT, I could get two related people that will live under the same roof and then be able to fill all the rooms. “This is what a real estate agent told me.”
Now that I have more information. What would everyone else do? Does it sound like a deal? Would you pass on it?
Looking forward to what everyone else thinks
Joshua
I agree with Doug. If the seller owes 154k and that is what it is worth:
#1. Paying him 8-10k upfront is out of the question. #2. Even if you could get t/b to front your option money to the seller, where is YOUR profit.
You said that you could buy for $154k and then sell for $154k in a year. You can get a premium price for giving a t/b terms. What are the comps in the area and what monthly payment has the seller said that he wants to “cover his costs?”
It doesnt sound like a deal to me. But, you have left out some information.