Getting ready to submit my first offer, thoughts?

[Scott Bartlett]

I just inspected a property yesterday, and got my first real look at it.

Here is the information:

Asking Price: $15,675
On the Market: 79 Days
Comparable Comps: 25-35K (I believe this to be a little low right now (The area just a few years ago was roughly 55-65K)
Expected Rent: $500 to $600

I did not factor in Closing Costs, but I figured a $7,000 bid offer with a contingency for inspection.

Since most of my cash will be used up in the initial purchase, I plan on using the property as collateral to secure a personal loan for $12,000 at 7.5% (Not sure if this is too high) over 5 years.

I assume that I got the COC correct? Or very close?

Here are a few pictures of issues that are scaring me, and what appears to be scaring investors off also (since it has been on the market for nearly 3 months, and no investor has touched it yet).

This is a picture of the roof trusses, which you can tell have been severely damaged from a fire years ago. They replaced the roof, put in new HVAC duct work and several other items that were installed AFTER the fire. You can see the new plywood, but WHY KEEP the trusses? I'm fearful that the entire roof will need to be replaced including the trusses.

More pictures of the attic with trusses.

Here is a picture of the roof from the outside, where you can see a noticeable "sag" in the roof, which I fear is from the poor condition of the trusses.

The other major issue with the property appears to be the foundation. It has had some work, but the work appears to be very shoddy and not very well done. Notice the support sitting on top of a cinder block which is unlevel... Walking around the house, you can notice a large slant walking around the house.

Here is a picture of a jack in the basement, just to give you an idea of shoddy the supports are (there are only a few of these, when there needs to be many more).

The last issue is, if both of these issues are something that needs immediate attention, I have to be able to keep the costs of these repairs down to approximately $8,000 to have both issues fixed. Would this be feasible?

I appreciate any comments you guys may have!

Last comment I wanted to include was: When submitting my offer, is it unreasonable to include pictures of the major issues in efforts to justify my "low ball" offer? These two issues I've pointed out are MAJOR, and I believe combined with the comparable in the area and the cost to repair these issues, I believe that the offer is justified, but do I include pictures in my offer?

[Rob Gillespie]

If you are going though with keeping it, I would absolutely take a few contractors through.
Just a quick note, 100 per running foot to replace foundation on a wholesale market. roofing 200 per square to tear off and put back on. labor and materials.
This is an example of what I pay. Keep in mind, I have given these contractors hundreds of thousands in work over the years. You will need to beat your guys up to get great numbers.
Good luck