Lease Listing
After discussing the lease listing agreement for the upteenth time with my wife, we decided to go ahead with it. I didn't like some of the clauses, but we have so much going on right now with other things, we don't have the time to deal with it any more. The contract is only for three months, so if nothing pans out between now and then, maybe we'll be in better shape to deal with leasing it ourselves.
I put in some stipulations such as pet restrictions, security/pet deposits, and even have the tenant paying the first $50 in repairs, however, that's going to be for non-major appliances only, such as light bulbs, smoke alarm batteries, air filter, etc. - just routine maintenance stuff.
Sub2
I got an email from a local investor who wanted to pass along a possible Sub2 my way. I told him that the numbers would have to work, but I'd be more than willing to take it on. He sent a reply with the figures, and I just don't see it working for me. The PITI is almost $1,700/month, which would be hard, if not impossible, to pay. The owners are willing to just walk away with a loan balance of about $176k on a house that's tax assessed at $179k. He had a good exit strategy, but this house is probably out of my league right now. Perhaps if I unload my current property or lease it out, I'd be more willing to take the chance on this one, but it's just too much right now.
I sent him a reply stating that it sounded good, but I probably wouldn't be able to do it. I told him if he had a retail buyer/leasee lined up already, I would go for it and pay him a nice finder's fee, but I wouldn't take it without one right now. I also thanked him and asked him for his investing criteria in case I find something for him later. I haven't gotten a reply back yet.
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3 comments:
Yeah. The more I look at it, the more I agree. The investor said he would create a note for $199k, and have the new owners put 3-5% down with the rest financed @8-9% interest. That makes it a little better, but I'd be a little nervous trying to get someone in at that price when comps put it around $180-185k and we're still in a semi-stagnant market.
BTW, Brian, did you read my post on your board? I found a few multi-family properties in the area, but not sure how good of a deal they are.
I have to agree with you guys that it's not a good deal. Don't get desperate and move on the wrong one, Steve! There's a saying in RE that for every hundred listings you find, you'll look at ten and buy one. Even Rich Dad has said that 99% of all deals are bad deals. It'll happen. Just continue to train your brain and you'll start seeing deals happen more frequently for you.
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