What is the properties real value?

[Jonathan Santa]

Hello everybody,

I have had my eye on an MLS listed property for a short time. It is listed at 215,000. It is a duplex (side by side) in Garfield NJ. One unit is a one bedroom with a miniature kitchen area and a fair size common room area. The other unit appears to be a two bedroom and in general is a tad bit bigger. Both units have one bathroom. From basic research I have concluded that the smaller unit could probably demand 900 a month, and the larger one 1150 or so. I imagine I would ideally want to price them a bit below market average to beat out some of the competition. The property has only street parking. Based on pictures, the current owner and the tenets appear to have keep the property clean. I was told a new roof was put on in the last 5 years and all utilities are separate. Aesthetically, this property is lacking (from the outside street view). It has the appearance of a converted two car garage and the face of the building is an unflattering stucco.

Details and attributes aside, this property has been listed on the market for over a year. It just seems that the properties listed price is too high. I played around with some numbers, and it would seem the only way this property would properly cash flow would be if the investor picked it up somewhere around 168,000. Even then the cash on cash return is nothing amazing. 

So would it be rude to offer a number that was somewhere around 75% of the asking price?

Also if somebody from north Jersey has experience with, and can shed some light on, what numbers could be expected at closing along with what operational expenses would look like in the first month, it would be greatly appreciated. I would like to get these numbers as accurate as possible before making any offers. 

Thanks!