I’ve had a bad feeling about what was-to-be House #13 for a couple weeks now. I think the biggest issue I’ve had is that the listing agent for the property has been making it very difficult for us to get through the purchase without making us jump through hoops.
First, she submitted the buyer information incorrectly to the seller, and made us create paperwork to fix her mistake. Then she had a big issue with a stipulation we included in the contract that stated we could use financing instead of cash to purchase the property if we so chose; she claimed the bank would have an issue with this stipulation, despite us using the same bank and the same stipulation on multiple past properties. Then, when we did try to amend the contract to use financing instead of cash, the listing agent wanted us to jump through a ton of hoops to get it done.
On top of that, while the numbers meet our criteria, it’s not what I would consider to be a great deal. It looks like we’re going to come in around our worst-case rehab estimates, meaning there won’t be extra profit, and comps in the neighborhood are hard to come by.
Lastly, none of us (me, my wife, my project manager, or our partners) are particularly excited about what this house will look like in the end. It will be nice, no doubt, but I don’t think it will ultimately be our best work (given our budget), and what we have to work with is average at best.
So, we’ve decided not to move forward on this project. We’ve canceled our lender’s appraisal, and we will eat the inspection costs on this one.
I always hate to back out of a deal (especially after getting inspectors, contractors, lenders, etc involved), but sometimes it’s necessary. In this case, I think it was the right decision…