I have been advertising heavily in my local area and recently received a call in regards to a high equity rental property.
The owning couple is ready to retire and move to AZ (I'm in MA). They have 2 properties:
- Rental Property - 3BR/1BA. Just signed 12 month lease for $1650/mo set to kick off on August 1st. Want to sell property to investor. Property is fully paid for. Comps appear to put value of property at roughly $230k, though tax assessed at $266k (Zillow puts value at $305k!).
- Residence - 4BR/2.5BA. Only about $10k left on mortgage. Rely on rental property for income to pay bills. P+I+Taxes=$700/mo. Current comps are showing value close to $390k.
Couple wishes to retire in 6-9 months and will be moving out of the area. They'd like to take the money from the sale of the investment property to make fixes to their property (outdated kitchen and bath), which I discouraged them from doing based upon their moving timeframe and the current market.
Also, with them being so close to retirement, the sale of the investment property will kick-off a large capital gains tax hit, which is not what they need.
I'd love to hear feedback on approaches to locking up both properties so that I can make it a win-win both ways. I had considered a Lease-Option on the rental, but with a currently executed lease, that's a little difficult to accomplish. I'd like to acquire the property while saving them the tax hit.
Also, I'd be interested in hearing out-of-the-box ideas on locking up their primary residence. I have discussed seller financing, which the homeowner was a little hesitant on...worried about what happens if my company goes under...to which I replied that they would still have the property as collateral.
Anyway, I'm open to any and all ideas.