Vendor Finance In Adelaide....

Hi Everyone,

Tell me if this deal is a good deal or not. I being thinking about it for a few day but have not come up with the answer. So here is the detail and tell me what you think.

I find a property in Burton, a northern sub. of Adelaide SA. There are plenty of new development up there and a brand new estate is being build at the moment. There is great potential for growth as Holden and Defence force is base near there.

The property is 11 yrs, 3 brms, lock up carport and full length veranda in the back. Land size is about 550-600 sqm and living area is about 135 - 145 sqm. It is a nice and near house. Market price is about $180K - $190K as house in the last six months is selling for that much with similar description.

The vedor asking for $182K
On settlement buyer pay $150K
Vendor carry back $32K for 2 yrs interest free.
Vendor will rent back for 2 yrs at $185 pw.

Doesn't matter how I look or structure it there is negative CF of around $2500 per year. However, the benefit is that I can but the property for little up front.

This is the question, should I bear the negative CF and buy the property that needed around $10K up front, or secure the deal and flip it to someone else or walk away from it since it is negative CF?

Please give me your opinion, greatly appreciated..

Dreamer

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