Re: potential deal - any advice?

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Posted by Robbie M on August 02, 2009 at 11:50:20:

In Reply to: Re: potential deal - any advice? posted by Tony Colella on June 24, 2009 at 07:50:31:

Hey Tony,

Your last reply to my post you suggested a lease/option scenario with the sellers and that may be a very good alternative here. Here's some new info and again, you advice is much appreciated:

Found out that per the State environmental dept, there are too many homes for the size of the lot. There are 8 homes on 1 1/2 acres with 5 large septic tanks - 1/2 acre is not being used. I could explain in more detail, but basically, in my county, there can only be 1 home per 3/4 acres. In the city, this doesn't apply, but in the county, this is the regulation. And unfortunately, the sellers moved the homes on after the regulation was in effect.

Apparently, there would be an environmental inspection upon transfer of title and if they enforced the regulation, I'd need to move homes off in order to comply.

I was thinking this deal is a bust, but then started pondering the idea of a lease/option. I'd be able to manage the property as it is and enjoy the great cash flow, but not have to exercise the option down the road. Or if we could agree on an option price reflective of only having 2 to 3 homes on the property (like I would have to do by complying with state regulation), then it may still be a good deal.

I've never done a lease/option with a park and am still not sure if this is even an option, much less a good option. Your thoughts??

Thanks Tony,


Robbie

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