Potenntial First Investment Property

[An Nguyen]

Hello everyone, 

My name is An Nguyen and I am living in Philaldelphia, PA. I have a question about one fixer-upper property within the area that I am looking to self-renovation with my father in law. 

Detail of the property: 

Living lot: 1,500sq ft. Total lot: 5,000 sq ft. 

Asking price is 275,850. Zillow estimate is 272,000. 

Comps are 350,000-377,000. 

I ran the number with Bigger Pockets Calc and the math came out to be 268k for purchase price with ARV is 400k.

My question is within my competitive market, how would the seller accept my offer 260-268? and would the ARV make sense with the comps are only ranged from 350-377?

[Brett Deas]

Quote from @An Nguyen:

Quote from @Brett Deas:

Do you have a good agent? If so they should be able to help you negotiate that offer to a good price range.

Always build in a buffer in your estimates, whether that is renovation time or selling price you don't want to be caught out at the end with no return on your capital. Also what is your expected renovation cost? depending on the reno cost the spread would not be too bad on that deal, but that is just me.

So we are thinking put in 35-50k for reno. 

 I think that spread is not bad, but if this is your first deal do not expect to profit. The first deal is always about education. Also, don't get hung up on this one, be willing to lose it. I don't know your market so there could be better/more deals around.