Thread: Deciding if the home is right

Hello, I am a new investor to real estate. I own a home already and I've paid down the mortgage quite a bit. Loan on my home is less than half of the value. I also have about $320k cash saved up. Seattle area. I want to buy a home with cash outright, to keep as a longterm investment. Rent it out. I may refinance it later and buy another if it goes along well. I am 39, 3 kids and a business owner. Some time on my hands but not much. I am comfortable becoming a landlord for the first time.

I found a home for sale in the same neighborhood I grew up in. Nice neighborhood, not many rentals there. I hope someone can give me some things to think about.

Good things about the house:
Quality construction from 1968. Very good solid home, no problems. One lady from a prosperous family lived here from 1968 until 2002. Sold it for $200k, it was sold again in 2006 for $320k. The current owner is out of state and wants out. He is offering it on the mkt for $300k. Given market conditions he will take $270k cash from me, I asked via phone and listing agent came back two weeks later saying $270k works.

House has a decent view of the city. It sits on a hill. House is on a quiet culdesac. No busy traffic. Can walk to brand new transit station, or drive (1/2 mile) and park there and take the train.

Nice interior design. I hate to say Frank Lloyd Wright, but it's unique. Flows well with the land in my opinion. No garage but large two car covered parking and a third covered walkway to double-doors. Inside, the house shows very well. Dual fireplace. Nice deck. Master bedroom has slider to deck, and view. Upstairs is about 1400 sq feet, 3 bdrm, 1 3/4 ba. Totally unfinished basement is another 1400 sq feet and has a full bath.

Bad things about the house:
Poor "street appeal". It sits down and when you drive up all you see is the roof. It's a low-pitch, almost flat roof, torch-down. Looks a bit ugly from the road to some people. Personally I think it looks ok, not bad, but others say it looks ugly. I have to take their opinion seriously. I brought out my dad and stepmom because I like their judgment. Mom said the street appeal issue will hurt future sales prospect.

Despite 12000 sq ft lot, the house has zero grass. Landscape is just pavement (odd, the owner paved over loads of dirt, I guess to avoid yardwork, as a landlord I see this as a good thing). Hate to quote my 70 year old mom but she says that people want to buy a home with a yard, so trying to sell it later will be a problem due to the lack of yard. I think people live in condos and apartments and other places all the time with no yards. The other 5 houses on the culdesac have no yard either and people live in them.

The unfinished basement was used by the last renters to grow marijuana. Renters came in and grew pot, Vietnamese guys. I have heard several stories about gangs of Vietnamese folks going around setting up operations. The basement is very clean and nice, the cops took out all of the plants. They had rigged up some wiring to light the basement, and tapped into plumbing for water, but this is all very basic and can be capped off, I know an extremely good electrician. There is zero report of meth here in this home, and I believe it was checked already but I will do more to cover myself on that.

Please share your thoughts on the home based on what I said. Thanks!!