Looking for some insight
Good morning everyone,
My wife and I are trying to figure out if there is a more strategic way of purchasing my father in law's house with also giving him the capital to purchase his retirement home.
It is located in the greater Seattle area, Covington, WA. The house is in good shape but has not been updated since the 2000's. He is asking for 600k which is conservatively 100k below market value. We planned to live here for two years, do a "live and flip", and then sell it and use the capital for other investments. He owes about 190k on the house and would like to make 400k to purchase his retirement home in the Phoenix Area. We were going to use a VA loan to purchase the property. Due to having a VA loan on one property already, rental in Tacoma, we would just need to put in 10k for the initial financing because we will have surpass the county VA loan limits.
We would love to keep the house and rent it out instead of selling it after two years. The city has just begun to build an outside shopping center about a mile down the road along with other improvements. Unfortunately, after using the BP calculator, I'm not sure how we could make this just break even ( calculator is about -1200 a month). Also I don't believe it would be a good STR area.
We are very new at all this and trying to learn. We have tried brainstorming everything from purchasing the Phoenix home and keeping the mortgage as is in Washington (essentially a family estate), renting it out and using that cash flow to pay for the Phoenix house and trying to break even that way.
Thank you for reading this and taking the time out of everyone's day.