Here’s a general update on what’s going on with the houses and the business…
Nothing much new here…we just hit 90 days on the market (still less than average DOM for this area), and haven’t had too many showing outside of the first weekend. My wife, brother and I have been brainstorming marketing ideas to get this one sold, but we’ve come to the conclusion that the area is just not ideal for most buyers (a bit out of the way), and it may be a while before we get any offers on it. Luckily, we don’t have a mortgage, and the utility bills are small, so our holding costs really aren’t too bad.
Once we get some time, we’ll expand our marketing for this property, reaching out to the local schools, churches, businesses and apartment complexes. I have a feeling the buyer for this one will have desire to be in the area, meaning they’ll have other ties to local organizations. I still think the it’s correctly priced (and the feedback that we’ve received indicates the same), so there are no plans to drop the price anytime soon.
I mentioned earlier in the week that we had a couple of interested buyers stop by our open houses last weekend. One buyer didn’t like the fact that the house didn’t have a basement (we pointed him to The Corn House as an alternative).
The other interested buyer was the woman who loved the house but got cold feet when it came to putting in an offer; we hadn’t heard anything from her agent all week, so my wife called him today. Apparently, the woman decided to put in an offer on Monday evening, went home to tell her family, and during the conversation, her son admitted that he had recently gotten a girl pregnant; it’s now up-in-the-air if the girlfriend and future grand-baby will be moving in with the mom and other kids, and therefore the woman is rethinking her decision to put in an offer.
Based on all that, I’m not expecting to hear back from this buyer, but the agent assures us he is continuing to speak with her, and is still pushing her to submit an offer…we’ll see…
Regardless, we are holding two more open houses for The Second Chance House this weekend, and my brother spent a couple hours today handing out Open House fliers to all the surrounding business owners and employees. Hopefully, we’ll get some decent traffic and some good feedback.
Title finally came back on this house, so we’re almost cleared for closing. Unfortunately, the seller has a rule that they need 5 days to review the closing package, and given that they won’t get the package until next Tuesday (Monday is a holiday), we won’t be able to close until the following week. Right now we’re scheduled for 2pm on Wednesday the 28th. Hopefully that date will stick, and we’ll finally be able to start work on this one.
We spent part of the day talking to contractors and getting bids on some of the work. As I mentioned yesterday, we’re about $7K over budget before getting firm bids, so we’re working hard to get our contractors to work with us on this one, and keep our labor costs low. Based on the work we did today, we probably recouped about $3K back into our budget, so we just need to figure out where to save another $4K or so.
Hopefully we’ll have all our contractors lined up — with firm contracts to do the work — by the end of next week. By then, we should have a much better idea of whether we can hit our defined budget or not.
We currently have two formal offers submitted that we’re waiting to hear back on. The first is a single family home that we’d likely use as our first rental property. The listing agent has indicated that we’re probably not too far from where the seller is willing to drop his price to, but there may be a bit more negotiation ahead.
The second property is a somewhat-run-down duplex in a minority neighborhood of a very upscale area (in other words, very blue collar, but not too scary). I really have no idea what we’d do with this property if we get it, but I put an offer in for $20K (it’s listed at $29K), and the land itself is probably worth double that amount. So, while I wouldn’t generally go into a deal without an exit strategy defined, I have a feeling I could do everything from using this property as a low-income rental to board it up and wait for the market to turn. I believe there’s a reasonable chance I’ll actually get this one for around my offer price, so I better start thinking about what my next steps would be…