Hi,
I had a lady contact me yesterday about a condo located on a lake resort in the cottage country in Ontario about 2 hours drive north of Toronto.
She is a teacher who used to live there but later relocated to Southern Ontario. The condo has been on the market for 2(!) years and has not sold. She is very emotional about it and just wants it gone.
These are the numbers from her:
Currently Listed on MLS: $200,000
Mortgage (LOC): $155,000. Interest only payments at 3.25% = $420/Month
Condo fee: $330
Prop. Tax: $125/month.
The condo currently rents for $900/month, the lease is up in March 2010.
She put around $40,000 in renovations into the place and it does look very modern on the photos. She would sell it for $160-$165,000 and is open to any creative ways it could be sold, including continuing to hold the LOC and Title in her name (talk about motivation!).
As a first step I was planning to confirm the ARV and assuming it is close to the listing price , its likely that the realtor may not have done a good job at marketing the property. I was planning to propose the following two options to the owner:
1) Option the property from the owner at $160,000 and then market the property at its market value. I feel this is the type of property that needs to be heavily marketed. If it does sell, I make the spread between the sale price and the option price.
2) If the above does not work, sign a JV agreement with the owner and attempt to get a tenant buyer in. It may be difficult to find a tenant buyer for that location, since its highly geared toward vacation but probably still worth a shot.
Both of these options require no money down from me (besides a few dollars on an option deposit) and if they don`t work out, I can walk away any time.
Would appreciate if fellow Legrand grads could help panel bit the above plan and if I am grossly overlooking some other potential options and/or pitfalls, any and all feedback will be much appreciated.
Thanks in advance!
Vitaly
I had a lady contact me yesterday about a condo located on a lake resort in the cottage country in Ontario about 2 hours drive north of Toronto.
She is a teacher who used to live there but later relocated to Southern Ontario. The condo has been on the market for 2(!) years and has not sold. She is very emotional about it and just wants it gone.
These are the numbers from her:
Currently Listed on MLS: $200,000
Mortgage (LOC): $155,000. Interest only payments at 3.25% = $420/Month
Condo fee: $330
Prop. Tax: $125/month.
The condo currently rents for $900/month, the lease is up in March 2010.
She put around $40,000 in renovations into the place and it does look very modern on the photos. She would sell it for $160-$165,000 and is open to any creative ways it could be sold, including continuing to hold the LOC and Title in her name (talk about motivation!).
As a first step I was planning to confirm the ARV and assuming it is close to the listing price , its likely that the realtor may not have done a good job at marketing the property. I was planning to propose the following two options to the owner:
1) Option the property from the owner at $160,000 and then market the property at its market value. I feel this is the type of property that needs to be heavily marketed. If it does sell, I make the spread between the sale price and the option price.
2) If the above does not work, sign a JV agreement with the owner and attempt to get a tenant buyer in. It may be difficult to find a tenant buyer for that location, since its highly geared toward vacation but probably still worth a shot.
Both of these options require no money down from me (besides a few dollars on an option deposit) and if they don`t work out, I can walk away any time.
Would appreciate if fellow Legrand grads could help panel bit the above plan and if I am grossly overlooking some other potential options and/or pitfalls, any and all feedback will be much appreciated.
Thanks in advance!
Vitaly
