After a week or so on the market, we ended up with three competing offers on the Meadow Arbor 1 house. Our real estate agent asked all of them to come up with their best and final offer by 7 pm on Wednesday evening.
Thursday morning, we all got on our morning call, excited to hear the news. We ended up with one offer that was $2K over the asking price. That felt good. Each offer had its advantages and disadvantages, though. It’s not always the highest offer that wins out in these negotiations. Sometimes the amount of closing costs a high offer wants to get paid will negate its advantages. Or an offer could have VA Financing that might not allow the house to sell for the agreed-upon price unless it appraises for that price (which can be a problem if there was a bidding war that drove up the price). We had some of each of those things to consider.
At first we thought we’d only end up with a thousand dollars or so in profit, but after looking more carefully at our balance sheets, it turned out that we would make a modest, but not shabby $10K profit.
We began discussing our plans for the house. Originally, we had intended to renovate it lightly and hold on to it as a rental property. And that’s what we did; there were no structural changes, and the only upgrades other than paint and flooring were to replace damaged areas of the house. Why were we wanting to sell, anyway?
This neighborhood is improving. Housing values are going up fairly quickly in San Antonio, and we believe we can get a really good rent on the house. Lee ran the numbers, and it turns out the house will cash flow at least $350 a month (paying the mortgage, taxes, and insurance, too). And we have the house across the street that we are working on next. It may even go for more!
We ended up agreeing to hold on to this property for another couple of years and evaluating the market at that time. If things go as we hope, we can make way more than $10K on it, after it has made us money in the meantime. If the market declines, we can continue to enjoy the rental income and use that on other properties.
Thus ends the story of Meadow Arbor 1. On to Meadow Arbor 2! Many thanks to those who helped on this one: Frank, the GC, and Alba, the real estate agent (who will be compensated for her time and effort).
On the Other Hand…
We are still open to seller financing, and there may be a possibility that one of those deals might show up before the house is rented. That would provide us with more cash flow, but we would not make the extra money we could get if we sold the house in a few years. Hmm. Decisions, decisions!