Your Ideas on buying this commercial property?

Your Ideas on buying this commercial property? by Anonymous (PA) on July 2, 2012 @18:09

I am being asked advice on something I have not done, so I am asking the BP community if they can help this couple. Details:

1) The property is in a MAJOR tourist area, on a very busy main highway

2) The couple wants to run a beauty salon/spa/wellness center

3) The property is a 4BR 2.5BA house (zoned commercial - used to be a tanning salon). Beautifully redone inside - perfect for this kind of business.

4) Couple wants to live in 2nd floor, so it can be financed as owner occupied, and first floor used for the business.

5) Asking price is $330K. Zillow says $320K and Eppraisal says $220K. Taxable value supposedly $190K. Sold 10 years ago for $195K.

Thoughts? Suggestions? Things to look out for? Ideas?

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Re: Your Ideas on buying this commercial property? by Nicole (PA) on July 2, 2012 @18:33	[ Reply ]

zillow is useless on values - it's only good for comps on properties sold/currently listed. don't know anything about eppraisal. when was the last assessment? if it was in the past two years, take the assessment times the common level ratio for that county and that will get you closer to what the value should be. I'd say if it sold for $195 10 years ago, it's probably only worth $195 today.

Re: Your Ideas on buying this commercial property?

Re: Your Ideas on buying this commercial property? by Anonymous on July 2, 2012 @22:51	[ Reply ]

Don't offer more than about 70% of the tax value. The tax values can be way off... Half of startup businesses are not there two years later. An appraisal is just a guess, not a firm figure. Did the seller or the buyer pay for the appraiser? There are still way more sellers than buyers in many, many areas right now. Get the owner occupied financing proposal in writing, for this exact property, as a commercially zoned property may not qualify for owner occupied financing.

Re: Your Ideas on buying this commercial property?

Re: Your Ideas on buying this commercial property? by Eric (MN) on July 3, 2012 @09:24	[ Reply ]

You have stated nothing. What is your purpose of the property? What is the anticipated revenue? What is the ROI? How mch capital to purchase and fix? My advice is to stay out of property investing until those are the first questions you ask yourself.

Re: Your Ideas on buying this commercial property? by Anonymous on July 3, 2012 @10:40	[ Reply ]

1) Location, Location, Location. There are some pro's and cons to this property. 2) Could be a decent business. What is the income level in the area of the people who live there and what type of income does levels do the people bring who visit there. 3) good 4)This soundds shadey and the couple seem a bit unstable to want to live there as well 5) You need to investigate the area within blocks of the property. You need to do an indepth comparison.

Re: Your Ideas on buying this commercial property?