Anyone Invest/Develop Real Estate Here? (House Flippers) (1 Viewer)

[Bucky86]

What could possibly go wrong?

 

[RUSF18]

She's not moving out. If the woman would leave for $80K in rent being covered, the owner would have offered her $100K to move out a long time ago and instantly seen his/her property value go up.

She'd be moving into a nicer apartment that is also stabilized, free of charge for 4 years. I'm sure her main concern is having cheap rent, and I've checked that box off.

This is prob where the current owner is struggling. Finding these apartments isn't easy.

There's a reason these people never leave. She's not going to want to pay the extra $300 a month from Year 5 until death.

 

[fantasycurse42]

She's not moving out. If the woman would leave for $80K in rent being covered, the owner would have offered her $100K to move out a long time ago and instantly seen his/her property value go up.

She'd be moving into a nicer apartment that is also stabilized, free of charge for 4 years. I'm sure her main concern is having cheap rent, and I've checked that box off.

This is prob where the current owner is struggling. Finding these apartments isn't easy.

There's a reason these people never leave. She's not going to want to pay the extra $300 a month from Year 5 until death.

Of course, why pay $5k for something that is currently $1400. However, get a similar deal, a lot upfront, and some more might be swaying for some.

300x12=$3600

She is late 60's. Even after 20 years, she is still ahead $10k

My final offer to her, assuming she says no, is 4 years, plus the extra $300 a month for another 5 years. This would have her rent free for 4 years where she can save all of her money and then equal rent for another 5. This is as far as I can go where it still makes a ton of cents.

 

[Bucky86]

She's not moving out. If the woman would leave for $80K in rent being covered, the owner would have offered her $100K to move out a long time ago and instantly seen his/her property value go up.

She'd be moving into a nicer apartment that is also stabilized, free of charge for 4 years. I'm sure her main concern is having cheap rent, and I've checked that box off.

This is prob where the current owner is struggling. Finding these apartments isn't easy.

There's a reason these people never leave. She's not going to want to pay the extra $300 a month from Year 5 until death.

Of course, why pay $5k for something that is currently $1400. However, get a similar deal, a lot upfront, and some more might be swaying for some.

300x12=$3600

She is late 60's. Even after 20 years, she is still ahead $10k

My final offer to her, assuming she says no, is 4 years, plus the extra $300 a month for another 5 years. This would have her rent free for 4 years where she can save all of her money and then equal rent for another 5. This is as far as I can go where it still makes a ton of cents.

It's probably less about the money with her and just not wanting to deal with moving her old ### again. Good luck.

 

[fantasycurse42]

Obviously a long shot with a lot of moving pieces, but if I can make it work, it will be well worth it. I'm giving it a shot. I tried to read the selling broker a little and couldn't get much out of him. My gut after our talk is she was simply offered $50k with no plans for another place and gave a strong no. He didn't give me an exact figure, but kinda hinted at that.

 

[fantasycurse42]

She's not moving out. If the woman would leave for $80K in rent being covered, the owner would have offered her $100K to move out a long time ago and instantly seen his/her property value go up.

She'd be moving into a nicer apartment that is also stabilized, free of charge for 4 years. I'm sure her main concern is having cheap rent, and I've checked that box off.

This is prob where the current owner is struggling. Finding these apartments isn't easy.

There's a reason these people never leave. She's not going to want to pay the extra $300 a month from Year 5 until death.

Of course, why pay $5k for something that is currently $1400. However, get a similar deal, a lot upfront, and some more might be swaying for some.

300x12=$3600

She is late 60's. Even after 20 years, she is still ahead $10k

My final offer to her, assuming she says no, is 4 years, plus the extra $300 a month for another 5 years. This would have her rent free for 4 years where she can save all of her money and then equal rent for another 5. This is as far as I can go where it still makes a ton of cents.

It's probably less about the money with her and just not wanting to deal with moving her old ### again. Good luck.

Most likely, I know it is a long shot, but worth the effort to at least see.

 

[eoMMan]

Are there any laws regarding people getting incentives to leave their rent stabilized apartments?

 

[fantasycurse42]

Are there any laws regarding people getting incentives to leave their rent stabilized apartments?

It is considered a buyout and completely legal. At her age, she basically can't be forced out, the only way to get her to go is to pay her and have her leave on her own.

Even crazier, she can leave the rights to the cheap apt to a relative in her will. It can go on forever.

 

[Bucky86]

Are there any laws regarding people getting incentives to leave their rent stabilized apartments?

It is considered a buyout and completely legal. At her age, she basically can't be forced out, the only way to get her to go is to pay her and have her leave on her own.

Even crazier, she can leave the rights to the cheap apt to a relative in her will. It can go on forever.

Wow. That's pretty crazy.

 

[Thorn]

Giving someone $50,000 under the table is most certainly not legal.

 

[RUSF18]

Absent all the stuff with the current tenant, my best advice for you is to overestimate the renovation costs and take a modest haircut on your expected sale price and see if it is still very much worth it to you in the end. Factoring in the headaches and sleepless nights of course.

My brother in law is a GC for a large construction company in Jersey. He bought a $500K house, put about $100K cash into a major remodeling, plus another $50K-$80K in "free" work/supplies from his employer in lieu of a bonus. He had plenty of relationships with a variety of subcontractors/vendors that helped move things along, and things still ended up being more expensive and taking longer than originally expected. Despite his experience in the field, he was still miserable and overworked for the 6 months this thing was going on.

Just some words of caution to you as a complete beginner.

 

[fantasycurse42]

Absent all the stuff with the current tenant, my best advice for you is to overestimate the renovation costs and take a modest haircut on your expected sale price and see if it is still very much worth it to you in the end. Factoring in the headaches and sleepless nights of course.

My brother in law is a GC for a large construction company in Jersey. He bought a $500K house, put about $100K cash into a major remodeling, plus another $50K-$80K in "free" work/supplies from his employer in lieu of a bonus. He had plenty of relationships with a variety of subcontractors/vendors that helped move things along, and things still ended up being more expensive and taking longer than originally expected. Despite his experience in the field, he was still miserable and overworked for the 6 months this thing was going on.

Just some words of caution to you as a complete beginner.

I appreciate it. All the numbers I'm looking at are already haircuts and overestimating costs. My doomsday scenario would involve me moving into this apartment, which really wouldn't be so bad.