I still live in the same town as my college and work 20 minutes away. Just recently a 3 bed/3 bath condo was listed at $260,000 that I can only afford 12% down payment on. It is a prime location and is less than a mile from school. I would expect to live there for 2-3 years and rent out at least one of the rooms for 2 years. Eventually I would prefer to turn it into a full time rental in the 3-5 year mark.

- Does this have bad written all over it?
- How much success has the MT had reducing the listed price?
- Has anyone done this before, and how was the experience?
- It is listed at $172.58 sq/ft and I am going to work on getting some comparable prices for the area tomorrow morning and some history regarding the property

Here is some comparable data of a development property a block over. It is now a building that contains a parking garage, bars, and condos

quote:
Land Sale No. 1

Property Identification
------------------------
Property Type: Commercial, Convenience Store
Legal Description: Part of Lot 3, Block 71, ************

Sale Data
------------------------
Sale Date: November 02, 2006
Property Rights: Fee simple
Financing: Cash to seller
Verification: Purchaser
Sale Price: $300,000
Cash Equivalent: $300,000
Upward Adjustment: $5,000 Demo house
Adjusted Price: $305,000

Land Data
------------------------
Zoning: PUD, Planned Unit Development
Topography: Gently sloping to south
Utilities: All municipal
Shape: Irregular
Flood Info: Not located in flood zone

Land Size Information
------------------------
Gross Land Size: 0.296 Acres or 12,874 SF
Front Footage: 115 ft Total Frontage: ************

Indicators
------------------------
Sale Price/Gross Acre: $1,031,987 Adjusted
Sale Price/Gross SF: $23.69 Adjusted
Sale Price/Front Foot: $2,652 Adjusted

Remarks
------------------------
**********. The purchaser plans to develop the property with a mixed-use retail/residential facility.

This post was edited on 3/5/13 at 1:11 pm

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Posted by LSUTOM07

Baton Rouge

Member since Dec 2011

783 posts

Posted on 3/4/13 at 11:38 pm to RickAstley

quote:
Eventually I would prefer to turn it into a full time rental in the 3-5 year mark

Just remember when you go to make another purchase, the bank will count both mortgages when you go to qualify for the second home. Your income would have to be high enough to sustain both mortgages while keeping your debt to income ratio reasonable.

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Posted by RickAstley

Reno, Nevada

Member since May 2011

2169 posts

Posted on 3/5/13 at 8:39 am to LSUTOM07

Thanks. It seems like a good idea, but I'm not accounting for several factors, including what you have mentioned, or the amount of money I could lose. I feel as if renting it out will not be an issue. I do fear what kind of maintenance/damages that could be brought upon the condo from college students. I would be interested in how that has worked out for people

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Posted by Broke

AKA Buttercup

Member since Sep 2006

65456 posts

Posted on 3/5/13 at 9:16 am to RickAstley

quote:
I do fear what kind of maintenance/damages that could be brought upon the condo from college students. I would be interested in how that has worked out for people

Renters will never keep your shite in the shape you want it. I will never be a landlord again.

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Posted by RickAstley

Reno, Nevada

Member since May 2011

2169 posts

Posted on 3/5/13 at 9:43 am to Broke

How long were you a rentor? Did you maintain the property yourself or did you have a property manager?

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Posted by matthew25

Member since Jun 2012

9425 posts

Posted on 3/5/13 at 9:54 am to RickAstley

$179 a foot? Up this way you can live in gated subdivisions/new homes for $130.

Can you say "bubble"

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Posted by RickAstley

Reno, Nevada

Member since May 2011

2169 posts

Posted on 3/5/13 at 1:11 pm to matthew25

I need to edit my post. This condo is $173 sq/ft. There is two condos a street over with one being $185 sq/ft and the other at $200 sq/ft. The others are very high

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Posted by NaturalBeam

Member since Sep 2007

15008 posts

Posted on 3/5/13 at 1:22 pm to RickAstley

quote:
bad written all over it

I don't really see how you will ever make enough money out of this to be worth your time. Owning college rental properties may be worth if it you have a bunch of them, but not one. You'll likely want to hire a management company to maintain day-to-day shite eventually, and that will be costly.

There could be some upside, but I wouldn't take the chance. Too much stress, too much that could go wrong, and too little potential return even if it does work out.

For shits and giggles, have you figured what your monthly note + taxes + insurance + PMI (or other way of getting to 20%) would be vs. what you could likely rent it out for, factoring in all landlord expenses?

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Posted by RickAstley

Reno, Nevada

Member since May 2011

2169 posts

Posted on 3/5/13 at 1:36 pm to NaturalBeam

Yea I realize getting a footprint in the area will be difficult as it is dominated by one guy who owns about every property on 7 of the streets. I've adjusted the numbers and my lowest monthly note I've seen is in the $1000-$1100 ballpark. I have no clue what is beyond that. One big problem is the guy that owns everything can undercut me fairly easily. I would want to rent it out at least at $1500 a month if I couldn't get a lower note, knowing I have several extra expenses I haven't accounted for.

I was dreaming pretty well last night, but not so much at the moment on this particular property. There is a 2 bed/2 bath condo that is much smaller but I could afford 20% down no problem. The only thing about it is its at $185 sq/ft.

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