Am I Being Scammed?
I just opened escrow on a fourplex in TX. Much of my decision was based on the calculations on the cashflow that I would be able to make on this property. However, since the deal was agreed, two things have happened:
1. The owner told the realtor that the annual taxes for the unit were $2552. I've checked the county recorders office and it shows taxes for that unit at $4400. I asked the realtor to check and the owner confirms the original amount. Now what do I do?
2. The realtor told me that though the properties currently rent for $500 to $550 per month, they would easily be raised to $650 per month. On checking with other property management companies in that area, I find out that it is a very soft rental market and that $550 per month is about right. The realtor also offered to manage the properties for me (as he does for some others).
At this point I am starting to lose trust in this realtor... is this normal sort of stuff, or am I being taken for a ride here.
The difference in those two issues (property tax and expected rental income) comes out to about $420 per month, which makes the property a lot less attractive than when it was potentially going to provide a cashflow of about $700-800 per month.
Your thoughts?
G
Change your offer based on these new developments / figures.
Lesson #1: Don't trust anything a realtor tells you - verify for yourself. The realtor is trying to get the deal closed, not trying to find you a good property. If their advice turns out to be true or good, consider it a bonus. I learned the hard way, not by buying a bad property but by having to check everything the realtor told me and finding most of it to be BS.
If the owner lives there and has a homestead exemtion then what he currently pays in taxes and what you will pay will very likely be different.
Thats my 2 cents
Good Luck[ Edited by baytitleguy on Date 10/19/2004 ]