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VHDA contacted a local real estate agent about selling two of it’s toughest properties in Richmond. After the agent got a look at the properties, they felt unprepared to handle the special marketing that these properties demanded. The agent realized that it would be better to refer the listings to a Distressed Property Specialist and collect the referral fee instead of trying to handle them herself. She called Steve O.

Both of the properties were in Church Hill Section and each had unique challenges for successful marketing. The first one, on 19^th St., had a tenant in place that had tried for years to buy the property from the former owner. The tenant had been promised by the former owner that numerous repairs would be made They never were and as a result, the tenant had grown apathetic about buying the house. Who could blame her? She also had experienced trouble qualifying for a normal FHA or Conventional loan.

All in all, it would be far better to sell the house to the tenant than to relocate the tenant, and then try to sell the house to another person. It was clear that, if at all possible, the tenant should buy the house. It did take some time (almost a year), but the tenant was finally able to obtain a non-conforming loan and buy the house. The seller did some repairs in order to accommodate the sale, but the expense was a fraction of what they could have spent had the tenant not bought the house. The seller received full market price, less a reasonable amount to compensate for the condition and they also received fair market rent while the transaction moved along. The tenant was satisfied with the price and was happy that they did not have to move. It turns out that the payment to own is less than the rent.

The second house was on Mosby St. and was difficult to evaluate. On one side there were some mansions around Princess Anne circle, less than 2 blocks away. Across the street was the entrance to a public housing low-income apartment project. To the rear was a mixture of new houses, and older derelict homes. To the right was two new homes and to the left were two dilapidated shacks. In this area there are pockets of high crime mixed with area of zealous and strong neighborhoods. The house itself looks like a three story home but in fact, one walks up a story and a half from the street to enter the first floor. The floor that should be the first floor is just foundation. The dwelling was built in the a early 1900 and was thick brick construction. Somewhere along the line, it had been covered with aluminum siding. It appeared that the house had a major overhaul about a decade ago, but had gone downhill. There were three dead cats inside as it had been shut up for years. The copper pipes were stolen. The kitchen had been modernized and then busted by vandals. Sheetrock covered the old plaster walls but also had been abused.

The marketing plan for this house was to sell it "as-is" most likely to an investor. Since the neighborhood pricing was so elusive and because the house did not conform to either the old shacks or nice new homes, we decided to start the pricing a little high and drift down over the marketing period. After the second price adjustment, we were able to sell the house ALL CASH. It closed within weeks of the contract being signed.