What to do with a pool - Posted by Mike Schmidt (IL)

Posted by JT - IN on May 15, 2001 at 06:36:02:

Taking a house in trade, is simpler than you might think. We have all been a party to a trade scenario, in the vehicular scense. It really is not much different.
There are several elements to making it work. The buyer must have enough equity in their house, (unless I am relly motivated to sell other property), and a re-saleable property. They must also be interested in buying another property that I have for sale. After establishing that they are a buyer for the house that I am selling, and we have agreed upon a price that I can live with, then I make an appt to view their property; (now I already have an idea what their home is worth). I attempt to give them exactly what they are asking for their house, less expenses. Expenses will be exactly what I need them to be, to make the deal work. eg.
Purch price: 79,900
Mtg payoff 51,500
RE Comm. 4,800 6% of my selling price
Repairs 500 Not all that relavent
Carry costs 2,100 cost to own, per mo. x 3

Total Exp. 7,400
Less Mtg. amt 51,500

Total Deduct 58,900

Net Equity 21,000

Less incidentals selling expenses like transfer tax, tax proration, etc.

This buyer will have a 21,000 credit at closing, toward the downpayment of new house, and at closing, I will either take their house subject-to, and resume their obligation on property, until sold, or sometimes the mtg loan must be paid off.

This purchase is not designed for me to make money on their proerty, but to facilitate their ability, (liquidity), in buying something else that I want to sell’ and am usually making pretty good amt of $$$$$ on. That is my motivation in this deal.

However, you could sharpen the pencil and have all types of creativity, with this transaction. You could reduce the price on their house, increasing profitablility on that transaction, supposing you had someone interesting in downsizing in property. You could become a facilitator in taking a house (or other property; boat, coin collection, etc. but NO children, which I have had offered), in on trade, and find them another house that you could buy creatively, on L/O or subject-to, that they would be the end user and ultimate owner of.
There are endless possiblities, once you get the ball rolling, because RE is nothing more than a BIG CHECKERS game. If you can always see your next move, the game can be real fun to play. Think about the “next move” when it is time to work out the details. Enough (too much) said here.

Just the way that I view things…


What to do with a pool - Posted by Mike Schmidt (IL)

Posted by Mike Schmidt (IL) on May 14, 2001 at 15:35:07:

I have a seller that is relocating. So far the numbers all look good and I think this could be a good deal. The home has a heated above ground pool. What would you do with this pool? I plan to turn the property around as a L/O. Is there to much liability with a pool? Would I be better off just taking it down or giving it away if someone would come get it?


Re: What to do with a pool - Posted by JohnBoy

Posted by JohnBoy on May 14, 2001 at 22:40:15:

If you decide to leave the pool and since you plan a leasing the property out with an option I would consider hiring a pool service to care for the pool properly and add that as part of the rent in the lease agreement. That way you don’t have a mess to deal with later should your tenant ends up neglecting the pool and/or leaving and not exercising the option.

Thanks all (NT) - Posted by Mike Schmidt (IL)

Posted by Mike Schmidt (IL) on May 14, 2001 at 19:44:27:


Re: What to do with a pool - Posted by Jim IL

Posted by Jim IL on May 14, 2001 at 19:25:07:

If you can swing taking the pool out without much effort and/or expense, and permission from the seller if you are doing anything other than subject to or conventional sales.
Once the pool is out, no more liability from that thing.
IF it stays, then get a good insurance policy that specifically covers the pool, liability and otherwise.
A pool not kept up can cause some sever problems down the road too.
So, after you have this insurance, make sure your agreement with the buyers or tenants covers their responsibilty to maintain the pool, and releases you from liability regarding the pool and them.
And, if you find a buyer before the decision is made on the pool, offer to sell it to them, telling them that otherwise, your partners want to tear it out and move it to another location.
You may even take payments for it, and create some small cash flow.
Sell the pool to someone else for a small amount.
Run an ad in the paper, “POOL For SALE, $x,xxx, You Haul, 555-5555”

Just cover your Assets on this pool thing well.
Take care,
Jim IL

It Depends… - Posted by JT - IN

Posted by JT - IN on May 14, 2001 at 18:06:02:

It depends on what price range of house and the condition of the pool.

If the house is in the $ 75 - 100 price range (now this may be 150 - 200 in another area), then it may be considered an asset by the new buyer, who always wanted to have an above ground pool. Obviously, if the price range of house is double that, then it is out of place. And the condition of the pool… It must be good, or pool is out of place in any price range of house.

I am taking a house in on trade, for a new house, with this exact situation. The FMV of home is $ 75 - 78, and I have cut a deal with Seller, to get the pool in shape, and maintain it, until I have re-sold the home. They are motivated by getting new home and are agreeing to do so. Another suggestion on maintenance on the pool, is a neighbor, who may have been dying to use the pool, anyway.

Just a few ideas…


Re: What to do with a pool - Posted by David Krulac

Posted by David Krulac on May 14, 2001 at 16:45:47:

Here in Pa the season is short. I had one house with an above ground that I made the seller get rid of before settlement. He griped and said it was no big deal, but afterwards admitted that it was more work than anticipated.
The second house had an in ground pool that we filled in.

Depends… - Posted by BenOH

Posted by BenOH on May 14, 2001 at 16:41:35:

An in-ground is a pain the keyster, especially in short summer seasons. Been there, done that. Above ground is work also, but it is easier to get rid of it. If it is in good shape, in a favorable climate, it migh be an asset.

Ad should read like this - Posted by barney

Posted by barney on May 14, 2001 at 20:04:22:

“POOL For SALE, $x.xx, You Haul, 555-5555”

Re: It Depends… - Posted by Vic

Posted by Vic on May 15, 2001 at 01:06:28:


Can you give us a quick synopsis of how you handle a situation in which someone wants to trade in a house.

I’m interested in how you work the numbers.