"Sacramento Dave" wrote in message
. com...

"miamicuse" wrote in message
...
Looking to make a purchase offer on a single family home for myself to
live
in. However, the home is not occupied by the seller, but by a tenant
who
has a lease that will not expire until December 2006. Closing date will
be
in mid April.

The price will be around 500K (well that is what I plan to offer). But
that
is what I am willing to pay for if the house is in move in condition.
Having this rental deal creates a real inconvenience, I have to pay two
mortgages for a period of eight months, I have to pay flood and
windstorm
insurance for my current property and this one, property taxes and other
maintainance (water, sewer, lawn, pest control etc...) and the monthly
rent
($1800) will not even cover part of a mortgage.

My question is, I want to quantify what this additional 8 months of
rental
deal will cost me. Then I would like to deduct some of it from my offer
price because it does cost me extra money. Not to mention the hassle of
when it comes time to terminate the lease at the end, I might be stucked
with having to return a security deposit which the seller has already
pocketed. But how will I quantify such a thing?

I know, I know, a house is worth what someone is willing to pay for it,
and
I know I am willing to pay 500K if the house is ready for me to move in,
but
with a lease? I don't know, I will not pay as much. Can someone help
me
figure out what is a fair reduction for this? Location is Miami,
Florida.

I have reviewed the lease agreement and there is no out clause in the
event
of a home sale.

Thanks in advance,

MC

First of all You should consider what your willing to pay or can
afford.
That's what should dictate your offer. Second you don't seem to be in any
hurry to move in ( Dec. 2006) seems like you have time to keep looking.
Basically your buying a rental house tenant included. How are the tenets I
would think a $500,000 house there not loser, How long have they been in
there? If they have rented it for quiet a while and it's not a mess then
chances are they wont give you a going away surprise. Most people are
decent
there a small % of idiots that's the ones you hear about.
Another factor would be What's the market going to be like in a year,
will
you make money on the house? But even if it goes down it comes up. In my
area my house Just appraised for $96,000 more than we paid 14 months ago.
So
in this dooms day market I made money ( people love doom ) We don't know
your Financial situation only you no that, I certainly know the feeling of
two house payments, it was tight until we sold our first house. There are
so
many factors, Is the house a deal at 500K? That important question. " The
price will be around 500K (well that is what I plan to offer" Seems like
you Know the offer. Sometimes you have to stretch for the payoff.



Thanks Dave, I am just trying to figure out a fair price to offer them, My
interest in the property is substantial because it has a unique style I
like, and I plan to do some major interior renovation once I take procession
so if the tenant trash the place (wall, ruin the carpet, break the sink
etc... I don't care). I also don't have an issue with payment (my current
home is paid off already and I might or might not sell afterwards). My
motivation for lowering the offer is simply the fact that I am going to be
paying a fee for close to 8 months for which I get zero benefit and this
somehow needs to be factored in.

The tenants are new. They moved in beginning of January. The agent told me
the property was vacant for a while and owner went to a nursing home,
daughter who lives far away is getting a warranty deed transferred and hence
cannot close till April...they put the house on the market and then hurrican
Katrina, then Wilma came through, damaged their tree, and part of the screen
enclosure, people weren't out looking for houses, one thing leads to another
they decided to rent it out and signed a one year lease but the house is
still for sale.

What I don't understand is, why the tenant, knowing the house is for sale,
will move into this place, with some hurricane damage (it will be an as-is
deal, with a right to inspect, so I have to take a serious look). The
renting probably also make the property less appealing to other buyers so I
think I have some leverage there. But I want to be fair and not take
advantage of the seller's situation. That is why I tried to figure out what
I would pay for should the house is vacant and then I need to deduct some
amount that is reasonable for the renting period. But it's tricky.

MC