Real estate investing inevitably comes up in  conversations over coffee. A friend of mine mentioned that her parents were ready to sell their home and retire in the country.  I asked her to have them give me a call when they were ready to sell as I would be interested in buying it.  We hadn’t talked price but she did admit that their original asking price had been about $30,000 lower than the bank had eventually appraised it for. I told her to consider it sold and took another sip of my coffee.  The look on her face told me that she thought the price was now too high and I had lost my mind.  To an unsophisticated investor it looked like I was throwing away money but I knew better.

Her parents were unsure of what to do or how to do it when it came to selling their home.  They might have been able to keep it as a revenue property but they needed the sale proceeds in order to buy their new home.  With the market as healthy as it is right now they were hesitant to involve a realtor and preferred to avoid the hefty commission that went along with that.  I don’t mean to sound skeptical as I often use a realtor myself, but if this is new to you it can be a scary process. They didn’t want to put their home up for sale too quickly as they needed somewhere to stay for another four months while their new home is finished.  The downside of waiting though would be that if it didn’t sell right away they would be stuck paying two mortgages until it did.  This kind of ‘analysis paralysis’ can be just as dangerous as leaping without looking.

I assured her that everyone would win if we went ahead because we would each walk away with what we wanted most.  When the real estate market is going crazy like Edmonton, Alberta where we live, I come to learn that you can pay market value for a property and still do very well on it.  Unless my friend understood the way this property would appreciate by this time next year, she would not understand why buying it at full price today was still a deal for me. On the other hand, if they sell to me now they get their sale proceeds right away which reduces their anxiety about finances.  This way they wouldn’t have to worry about finding somewhere else to live until their new home was finished as they could continue to live in their city home.  Construction trades have been in such demand that not only are the prices skyrocketing, but possession dates are moved numerous times due to delays. This way they could stay as long as they want with no pressure and I have great tenants who love my new property and will care for it while they live there. There is really no down side to this real estate sale and everyone literally gets what they want out of it.

 Her parents were thrilled with my proposal as it addressed each problem they had with a viable solution.  We all get what we want whether they pay rent while they stay or I take their rent amount off of the selling price.

 I am very happy to get their beautiful property without the hassle of looking for it and they are even happier to sell it painlessly and be able to stay there as long as they need to.  It is the perfect scenario for everyone involved and an investor’s dream deal.

Rhonda Hoffman

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