[quote=flu]Well ok great. So how long have you been trying to do this, and how long do you think it will take before you can start generating income from this strategy.?I ask because it sounds great as a plan, but if it takes like 10+years for one to just get started, I can’t wait that long. There comes a point when I don’t want to start doing this in my golden years. I want it done well before then so that in my golden years, everything is on auto-pilot more or less.
The other question I have is if someone needs to sell, how do you figure they aren’t going to try to put in on the market and try to get the best offer possible ,but rather sell to you directly?[/quote]
flu, I don’t understand why your “rental home” can’t be up and running and producing income within 60 days of purchasing it (assuming it needs SOME rehab upon purchase). I would be buying with an equity partner and likely paying cash, thus closing costs would be low. I’ve only approached some of these owners for a friend who was looking for investment properties a few years back and at that time, none of the owners wanted to sell. Things change as people move on up into their eighties and beyond. Sometimes it takes a few years for their kids to successfully talk them into selling non-productive rental properties, ESP if they will need the money for assisted living.
Most all of these properties need more work than lenders will approve (esp for the FHA 203b program). The work isn’t that expensive if you can do most of it yourself (no structural problems) and have ways of getting some work done cheaper. These owners aren’t likely to get multiple offers above what someone off the street would privately offer them considering they would be saving the sales commission. As a principal or co-buyer, I would obviously have to disclose to them that I am a licensee in my or “our” offer to purchase.
These properties are DEFINITELY not ready to compete with the vast majority of listed properties on the MLS today and their owners won’t undergo any cleanup/rehab. A few of them have the owners stuff stored in them.
There are a LOT of houses all over SD County that may have a “porch swing” in front and furniture inside. This is no way means anyone lives there … or has even lived there in the last decade. If the owner bought it for $5K to $32K, it has been paid off for decades and its property taxes are $368 year, WHO CARES? Just store your stuff and turn off the utilities. Get your grandson out there in the front yard once a month with the weedwacker (to appease city/county officials). You have a nearly “free” indefinite storage unit. DONE :=D.
