REI – Buying a Property While on Vacation

Today I am going to go over how we negotiated a purchase agreement for a new rental property while we were on vacation. I will summarize how it can be done and why you shouldn’t sit around waiting for something.

Part of my process for finding properties is to have searches set up on the various real estate websites such as Trulia, Zillow, and Realtor. They send me emails on a daily basis with local properties in my areas of interest that meet my investing criteria. I noticed that there was an REO property up the street from the last property we purchased. REO is Real Estate Owned and means that it is a property that the bank has foreclosed on and wants to get off of it’s books, hopefully recouping the money they have into it.

This property had been foreclosed on by the bank and sold at a Sheriff’s Sale back to the bank at some point prior to February of this year.  They then listed it for $98,800. About six weeks later, they dropped the price to $89,900. A month later, it was $79,900. Then they ramped it back up to $98,800 after 6 weeks, but dropped it to $79,900 about 5 days later, so it must have been a typo. And roughly two weeks after that, they dropped the price, again, to $69,900.

It was at this point that we decided to go look at it. There was no power or water service connected, so we couldn’t inspect the plumbing or electrical functionality, but we were able to look at everything.

The property apparently had doors and paint updated in recent years. The floors were mostly tile throughout, with real parquet wood floors in two of the bedrooms and damaged/improperly installed laminate flooring in the master suite. The back exterior will need a little attention along with the roof, but all in all, the property appears to be in good shape and not needing as much in rehab as our last acquisition.

The day we looked at the property was the day before we were leaving for the week to go on vacation out of state. We did not have time in our schedule to travel to the realtor’s office and sign paperwork. Luckily, we did not have to. The offer was submitted online via a secured signing portal.

All further counter-offers were done in a similar manner either from my phone or laptop, allowing us to enjoy our vacation and still take care of business on our schedule.

We are currently waiting on the “paperwork”, but we have come to an agreement on price and are waiting for the start of the due diligence process, where we get the property inspected and look for any deal-breakers.

I will detail the whole deal in a future post, once the deal is complete and the  property is rehabbed and rented.

And, as always, let me know what you think in the comments. Ask questions, tell your story.