<p>coralbrook - how exciting. Fingers crossed that you get this! So now I’m really curious what neighborhood it’s in since I am also in SD.</p>
<p>(I can’t get over no heat! I know it’s CA but I live in AZ and that wouldn’t work here…argh!)</p>
<p>I will definitely share location when I get a signed contract. I don’t want to jinx it.</p>
<p>I was just given an update that the Seller’s attorney has approved the offer and they are preparing all the documents to meet with the Seller to get it signed. I am on pins and needles. Cannot do anything besides stare at my email screen waiting for an update 
Already used my nervous energy to scrub the oven this morning</p>
<p>I believe that the owner has space heaters in the house that she has been using for years. But, without a permanent heat source it doesn’t qualify. I will need to put in a new HVAC system with ducting and everything. House also has original knob and tube wiring which means full re-wire. I am going to do everything I can not to have to tear off original plaster walls. </p>
<p>Can’t wait to hear about this place! We visited friends a few weeks ago that recently moved into a 900 sq foot 2bed 2 bath house in Mission Hills built in 1939. It has a bit of land and was pretty much turnkey. The house is really adorable!</p>
<p>Good luck, coralbrook and thanks for sharing this experience with us.</p>
<p>I did not say I was lucky. Just wish me luck.</p>
<p>I have drive the property yesterday which I made an offer. The location is not ideal, right on the BART rail track and there is a dry bridge near the house that is for pedestrians to walk across the rail track. I can observe the house exterior from the bridge steps, it is good for me to examine the exterior. But that poses a security threat for anyone that has an ill intent and the owner of the property has no privacy whatsoever.</p>
<p>The house has some potential, I can add a master bath to the house so to be sold as 3 bed 2 bath. It has a flat roof, so it could pose some problem, but the realtor said the roof is not leaking. I saw new vent was installed, so I guess the roof should last for a while. Another problem about the house is the house next to this is dilapidated, the owner had never updated the house so the paint is peeling and I can imagine the inside is also dated. The backyard of this neighboring home is a disaster, they use a tarp to cover a part of the fence that is probably missing.</p>
<p>The only thing about it is its price below market for about 100K(consider the cost of update) and that is why a lot of interest in it. When I was there, I ran into several neighbors and they seemed very normal and warm. They told me the dilapidated neighboring house is owned by a normal family, they all get along fine.</p>
<p>Anyway, it is just a short sale on MLS, who knows what will happen, I would not count on my offer being accepted.</p>
<p>One thing I got the cue from CB is that when I made my offer, I did make the listing broker being my agent so that he can get paid from both sides of the transaction. Perhaps that will draw his attention to my bid and I can benefit from it. :)>- </p>
<p>Fingers crossed for everyone.</p>
<p>How exciting!!! Good luck to both of you!</p>
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<p>I was referring to the “property wars” TV show. In that, all the buyers gathering around the subject house being auctioned off to inspect the property at the last minute and their counter parts at the same time are at the court steps bidding. They examine the homes from outside and call in for the bids. The buyers interact with each other so that to make the show interesting, many times there is a verbal or even physical fight. After one of them outbid everyone, the counterpart at the court steps drive to the property and have the key open the empty house…What?</p>
<p>In one of the episode, a buyer showed up early at the property and let his dog into the fenced yard to make a illusion that the house is occupied. All the other buyers saw the dog and did not bid the home so that buyer with the dog had out smart everyone else.</p>
<p>The TV show normally has 3 homes being sold on the same day and the properties are sold on the same day, all vacant all biddable, never had a cancellation. And the price they pay is very closed to the retail, with only 5%-10% margins.</p>
<p>And they call it REALITY TV! </p>
<p>Well, yesterday was a roller coaster day.</p>
<p>Just as the listing agent was sitting with the Seller presenting my offer, another full price offer came into her office and someone called her with the offer. The full price offer is $12,000 over my offer with similar terms. The other offer was from an agent in their office who knew about the upcoming listing and called a bunch of the big boys. The offer is from a group of men that I know well, I am always standing toe to toe against them at the auctions but they always outbid me. I just cannot figure out how these guys can turn these properties for a lot less than I can.</p>
<p>I had written a cover letter and the Seller (and her financial advisor) just loved the cover letter. Listing agent called me from their home and said the Seller wanted to meet me. I jumped in the car and raced over to the property and spent about 10 minutes walking through her home with her. Then I gave an impassioned speech about how they may get a higher offer from one of my competitors but that I loved the house and would renovate it, preserving all the original features. My competitors are ‘quantity over quality’, but I would make it a labor of love. I was a good listener to everything she wanted to tell me about the house.</p>
<p>The listing agent was very smart about asking me to come over because I have made a personal connection with the Seller and her advisors now. </p>
<p>Their assistant is the one who gave me the lead and she will get a ‘finders fee’. So, she has been secretly giving me updates on the situation. One thing I learned is that the Listing Agents have dropped their commission with my offer which truly makes the difference only $7,000. I also learned that the Seller has no money and does not have anywhere to move because she doesn’t have the first/last and deposit for her move. </p>
<p>So last night I worked with the Listing Agent (who doesn’t know that I know about their commission reduction). I raised my price $3,500. And I changed my offer so that the Seller will get $10,000 released immediately from escrow (to give her money to find a home) and a 60 days escrow so that she has plenty of time to find a place to move. I am hoping that the creative terms will be to her advantage. I know that the competitors want her out of the house within one week of closing.</p>
<p>So, today I sit on pins and needles waiting to see what will happen</p>
<p>Oooooooohhhhhhh, Coralbrook, what a roller coaster. How great that you got to meet the owner. Maybe also send her a follow up note thanking her for her time and reiterating what you told her when you met??</p>
<p>I am trying very hard not to get emotional about the house because I just cannot afford to offer full price - it comes straight out of the profit. I’m trying to get as creative as possible with the terms. I’ve even offered to help her move with my truck to save her moving costs.</p>
<p>The main issue right now is that I am sitting on my hands. I should be going to the auction today or making offers on other homes. But, if I do that I could risk using up my money while waiting for an acceptance. A smart businesswoman would keep going but I’m going to hold to see if I can get this one. My competitors have deep pockets and they can attack from all directions across many properties and buy multiples at a time.</p>
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<p>Unfortunately we too often deal from emotion. You’re right;you should continue looking. </p>
<p>Just like the kid who shouldn’t count on getting into his ED school but should continue working on his apps for other schools anyway!!</p>
<p>Quite a saga… this sort of agent behavior bothers me a bit, because they seem much more interested in getting a quick sale with a client in their pocket then maximizing the money for the seller. If it hits MLS, who knows what kind of offer she would get. She may be leaving 10’s of thousands on the table because the listing agent has manipulated her into thinking a quick, private sale is better.</p>
<p>If she takes the full 60 days to move, what will you do in the meantime?</p>
<p>Well, I guess I will sit on my hands for another 60 days But I have something interesting coming up which I will share later - I have been asked to remodel a home with my crew and it might fit in well for the 60 days.</p>
<p>A buyer with financing cannot buy this house, so it would only be investors paying all cash.</p>
<p>There is value to this Seller to not have showings and imposition in her life. In all honestly the comps in the neighborhood for poor condition all cash sales do not support paying more than $409k for this house and the asking price is $427k. Many competitors play the game of having an inspection contingency and then coming back after inspection with a list of horrifying things that need to be repaired and asking for a credit or reduction in price after they are in contract and the Seller is too far in. It’s a big game. But everyone is betting on the market appreciation in the neighborhood right now. </p>
<p>A more important question is that if the old lady does not move after renting for two months than you have a hot potato on hand. You will have a hell of time to evict her if she continue to pay rent. The judge will not evict her because you are an investor. It could take years to resolve the problem.</p>
<p>I’ve changed my offer to 60 day escrow with an early release of some deposit money. Therefore she is in a contract and she has to be out of the house to close escrow and get her money.</p>
<p>I would highly recommend in situations like this that you don’t create any kind of tenancy. Hold money back in escrow that gets released after they move out, but do not accept rent of any kind.</p>