Shop for­mer rentals for hous­ing deals

The Palm Beach Post - Residences - - Front Page -

A cou­ple in their mid-30s are strug­gling to find an af­ford­able house be­fore their first baby is due in five months. That’s an ar­du­ous chore be­cause they live in an ex­tremely high­cost area.

Con­sid­er­ing their in­come lim­its, the cou­ple in this true story have latched onto a po­ten­tially good buy­ing strat­egy, says Ash­ley Richard­son, a vet­eran real es­tate agent af­fil­i­ated with the Coun­cil of Res­i­den­tial Spe­cial­ists (crs.com).

Sid Davis, a long-time real es­tate bro­ker and au­thor of “A Sur­vival Guide for Buy­ing a Home,” es­ti­mates that those who pur­chase a well-cho­sen rental home can save as much as 30 per­cent off the mar­ket value of a sim­i­lar prop­erty in bet­ter show­ing con­di­tion. Here are a few point­ers for cash-tight buy­ers pon­der­ing a rental prop­erty:

1. Try to plan your first visit when the renters are away. Those liv­ing in a rental unit are typ­i­cally — though not uni­ver­sally — un­happy about the idea that their land­lord is mak­ing them move.

2. Make sure you ob­tain an in-depth home in­spec­tion. Al­though many rental prop­er­ties are over­seen by pro­fes­sional man­age­ment firms, they rarely re­ceive the same level of at­ten­tion as owner-oc­cu­pied prop­er­ties. That’s why it’s crit­i­cal to make any of­fer con­tin­gent on a sat­is­fac­tory home in­spec­tion.

3. Ob­tain cost es­ti­mates for all the re­pairs you’ll need. Prospec­tive buy­ers of a rental prop­erty — or any home, for that mat­ter — should de­ter­mine in ad­vance how much needed re­pairs will cost. Get es­ti­mates for all the re­pairs on the in­spec­tor’s list be­fore fi­nal­iz­ing a bid. Then make sure th­ese ex­penses are fac­tored into the price they ne­go­ti­ate.

4. Place lo­ca­tion at the top of your list. In many neigh­bor­hoods where the real es­tate re­cov­ery is still ro­bust, buy­ers con­tinue to out­num­ber sellers.

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