I’m interested in a 2-storey property that has 3 bedrooms upstairs and a 1 bedroom flat downstairs that could easily be expanded to 2 bedroom by converting an old garage under the house thats used for storage. The block is big enough to build another house, with the existing house situated at one end of the corner block. the property is situated in a good suburb of Canberra, the house is old but very strong (double brick throughout). It needs work!
The only problem is I don’t have the money to purchase it. My thought is to talk to the owner (in his 60’s and has just inherited this house) about becoming the bank for me. He’d get a regular income over many years rather than a lump sum, possibly reducing impacts of capital gains and on his pension.
I assume that I would then own the property, even though the original owner would have control over the property if I defaulted. I could then get a loan via increased equity to build a second house and have tenants in the house and flat.
Am I right? I’ve only recently read parts of Robert Allen’s books and Steve McKnight’s book and currently have 2 buy and hold properties using the Navra strategy.
Any other ideas for this property?
Cheers
NeilGo for it, it seems an okay deal. Perhap just Vendor finance the deposit or if you use long contracts (like 28+ pages long) increase the price on the contract and get the vendor to keep the difference as the deposit. Of course this MUST be in the contract (and banks don’t tend to like it very much at all – but if it is in their contract, and they approved it, it’s not your fault).
Rgds.
Lucifer_auHey Neil
How big is the block? Really suggest you talk to the ACT Planning people about building that second house – if it’s not 1400m or something, they won’t let you have 3 units on it – unless the 1 bed flat is not an approved separate dwelling.
We’ve got a place in Cook that is a 2×2 bed, and thought we could dual occupancy, but no can do!
Cheers
Mel
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