TM_Properties

Yea, I agree. No matter what, it's good experience.

No, not yet. I'll call him tomorrow. $1500/month is low for a very nice 4 BR in that area. I think the seller would do $1500 but not with 50% rent credits and a $220k purchase price. I'll have to go over some different scenarios with him. Thanks for the link to Zilpy. I'll check them out. Zilpy says $2000/month for rent with a range of $1750 - $2300. -Tim

I checked Craig's List and there are similar properties in the same area renting for $1600 - $1800. I think that a lease purchase at $1800/month is doable. There aren't a lot of rentals in this area so it's a little difficult to determine.

Thanks Michael. I've already told the homeowner that $250k is too much and comps are around $220k - $230k. He's also been told the same thing by a couple of friends that are realtors and he's realistic. I don't know what he currently owes on the mortgage. I'll have to find out what his bottom dollar price is. He owns another house that he lives in and definitely wants to unload this one so there is motivation. It might come down to him being able to lose less money by doing the lease option. I'm simply trying to come up with some numbers that are going to be acceptable to him and allow us to get a tenant/buyer in ASAP. I think that $230k will work as the purchase price for the tenant/buyer. I'll just have to see if it'll work for the seller based on the other numbers I come up with. -Tim

I'm not sure. I used Rentometer to check the rents in that area for a 4BR and $1800 came back as reasonable for the area with $1600 being the median. I also checked on rentals.com to see what other houses in the area were renting for and it looks like $1600 is the norm. Is there anywhere else that I can check online? Being new to this I don't know the market rents.

After marketing for over a month, I finally have a seller who's interested in a lease option. I've talked to him on the phone and he likes it. I told him that I needed to look at the numbers and then I'd get back to him. The house is very nice (from pictures) and in a very nice neighborhood. From talking to the seller, he's more interested in a SLO where he wouldn't have to worry about anything. Here's the numbers: The house is a 4BR 2.5BA 1800sf with a 2 car garage and finished basement (additional 400sf). The seller says he'd like to get $250k for it (that's what he's got in it) but he realizes that comps run around $220-$230k (using recent solds from the MLS). He's been trying to rent it for $1600/month after having it at $1700. It's been on the market for over a month with no takers. He says that he can go down to $1500/month. Looking at these numbers, I can't do a SLO. There's no profit there for me. I'm thinking that I could still do a CA though. Is this what you would suggest? With this being my first deal, I don't want to screw it up. I was thinking something like this: Purchase price: $240k Monthly payment: $1800 Rent credits: $600/month for 12 months Lease term: 1 year Lease Option: $8400 (3.5%) With this, he doesn't get his price but he's getting more cash flow than just renting. He's also getting more money on the sale than he would selling it through a realtor. Please help a newbie do his first deal and let me know what you think.

Ken, this very same thing just happened to me last night hehe. In my opinion, if the house is officially "listed" with a Realtor, then I move on. But there are some exceptions to the rule though - First I make sure is officially listed or is the Realtor just helping the owner by listing the ad on CL? This happens a lot in my area - Secondly, I test the Realtor to see if I can get past him/her so I can talk directly with the owner.. If he/she says "no" and to deal with him/her, then I run the other way and move to the next prospect.. that's just me... But if he/she says "yes", then I'm good to go and take control I applied all the details I mentioned above to a real case last night with a Realtor on CL (FRBO) and here's the email he sent me this morning... ---------------- Hello Ms. Bev, Please call Mr. Garcia directly to talk to him about your program. He is very open to the lease option. His phone # is 209-xxx-xxxx. --------------- Now if you'll excuse me, I'm gonna pick up that phone and give Mr. Garcia a call ASAP! BEV! Hi Bev. I'm a newbie here who's just getting my marketing started and I'm seeing a lot of these rentals through realtors. I'd like to see what you said to the realtor to get to the owner if you don't mind sharing that with us. Thanks and hopefully you were able to land this one. -Tim