Buying with tenant in place?

If the tenant is rent controlled, then you should get at least a 20% discount, if not more. If it's a market rate tenant, I am not sure if you will get a discount since you can boot the tenant once the lease is up.

hey el jefe---why 20%? why not 27% or 18%? and...a discount from what?

OP--not enough facts presented to formulate intelligent answer.

discount from the asking price dimwit.

so...if i'm asking $3 million for a studio with a tenant, you would recommend offering $2.4 million?

if you were asking $3 million for a studio, I would offer you a free cab ride to Bellevue.

Considering that tennant's children can assume the lease, I think a 20% discount is wildly overpaying. You can be stuck with an apartment where the rent doesn't even cover maintenance, an apartment you will never get any value out of.

that's not entirely true ChasingWamus. We do not know if the tenant is rent controlled or market rate.

if the tenant is market rate, then you can boot them at the end of the lease. And if they don't want to go, then just double their rent and I doubt they will be around too much monger.

You are right, I thought the thread was about a rent stabilized tenant. I have seen apartments for sale with rent stabilized tenants asking for a 25% discount, which seems crazy.

e76, this might apply: http://www.streeteasy.com/nyc/talk/discussion/12361-why-buy-an-apt-wrent-controlled-tenant

Whole different set of possibilities if you're talking about one of those yokel-speculator's-delight new condos.

i was referring to market rent units (i have no experience with rent controlled units and they scare the living hell out of me)

If you are getting a market rate then there's no difference from if there is no tenant. Unless you need a place to live, in which case don't bother.

You should consider if you plan to live there once the tenant's lease is up.

If yes, then with 30% down, the mortgage and maintenance should be covered.

If no, with the same 30% down and consider that the is a good chance that the rent will be down 10-20%. Then see if mortgage and maintenance will be covered and you should have some left over.