War Zone Property
Just gathering Ideas
Been buying up some war zone type houses in a really bad area of town. This town does not have the guns and such but drugs and poverty have been prolific.
We are working on one block at a time. Lucius since you are very familiar with this kind of project your insight is most welcome.
First time I have run into a foreclosure in this neighborhood. Primarly rental area. The bank bought it back for under 50K and we want to make a respectable but very low offer. The house was brokeinto and drugs were being dealt on the front steps. The city moved in and put up crime scene tap and posted a constant vigilulant patrol (which is good becuase we have houses next door.
We are buying these 10K houses fixin them and fencing them off ect....... and selling them to the very low income renters in the area.
What (and experienced buyers please comment) would you offer that you believe the bank will take. We've had difficulty getting texas lenders to take low ball offers (that really do make $ sense) on foreclosure in our ballpark.
We've had a suggestion of 5K to 10K. and for the area that is really the numbers that work.
One of the problems is that tax accessor has the house valued at 140K if you can believe that.
Let's see, the tax assessor says it is worth $140k (really means nothing)and you want to buy it in the 5-10K range. If this works out, i may move to Gun Barrell.
Did you pay $10k for the house next door? If so, what could be a better comp to prove to the bank what the real value of that property is? Of course you would have to consider how long it has been since you purchased that other property, but I would say you know that market better than the bank does. Build your case on your experience in that neighborhood. Don't worry about low-balling it....what's the worst that can happen? They'll say no? Wait a couple of months and make the offer again. I have read many posts on this site and other stories where banks will sit on a property for several months after turning down a lowball offer and then when the same (or even lower!) offer is made, it is accepted.
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'If I am not for myself, who will be for me? If I am for myself alone, what am I? And if not now, when?' - Hillel
[ Edited by Shirley on Date 01/30/2004 ]
This is not in Gun Barrell but close so don't get to ready to move! <IMG SRC="images/forum/smilies/icon_smile.gif"> our market is very hard to work and We work in several rural suburbs.
the houses we buy in this neighborhood are in the 12K-30K range but getting some goofball at the tax accessors to office to value property in this particular county correctly is a waste unfortunately the banks use these apprasials from the accessors office.
The property may be worth (in this neighborhood) 40 - 50 K with all the fixup and security measures we will install but not more than that. We need to keep the cost to get into it low due to the avg income in this neighbor is below the poverty level. This town has no section 8 and the housing that it has for low income is minimal.
We are trying to move into the area to clean it up as it has extreme potential, the city is moving in that direction (rather around it and it is a little pock mark in thier growth).
Our plan to utilize our expertize and actual work in the neighborhood to get the city to zone it for CBGD and get some gov funding is the long term goal. Small towns are so ole' boy gotta prove yourself to them first before they will help.
We've had to offer several times for foreclosed properties but we haven't had any luck and they are still on the market you'd think after a year or two the bank would be happy to write it off, not been our experience yet. We still make offers every couple months.
We got the next door prop for 12K but it is smaller but not in the same shape.
We don't have enough "experience" in the neighborhood yet to get anyone to listen. The majority of the neighborhood is rental and the owners are the SLUM lords in every sense of the word so it's kind of tough to work the area. But it is our pet peeve and not our main concentration of work. This is something we feel needs to be done and we will continue onward one at a time til our long term goals for these people are met.
In the meantime our base income is else where. This will eventually be turned into a non profit venture.
[ Edited by Dreamin on Date 01/30/2004 ]