Need advice on our current situation!

[Jesse M.]

Hello BP members, I am looking for some perspective on a potential real estate transaction. My fiancée and I are in the early stages of REI and are focusing on learning the fix and flip strategy. We are currently renting a town home and our lease will be up on the first of July. With that said, we want to invest in our first property relatively soon, but we want to make sure we get off on the right foot.
Our current landlords just added a set twins to their family and recently contacted us asking if we were interested in purchasing their town home (their email said "make an offer"). We are thinking of purchasing this property to have a place to live while we focus on fix and flips and believe it will be a great cash flowing property (if we purchase for the right price!) once we move on to another property to call home. It is in a great location close to highly saute after schools, shopping, and a lot of recreation.
We are meeting with the owners tonight for coffee to discuss our options for purchasing the property, or possibly extending our lease if the price isn't right.
Here are the numbers on the town home and some additonal info, any suggestions on what a reasonable offer would be and/ or input on whether this would be a wise first investment? Thank you!

Numbers:
As of right now we have around 10,000 saved for a down payment and the town home qualifies for FHA.

Current owner purchase price in 2009
$178,341

County Assessor's Value
$125,400

Zillow est.
$116,740

Zillow rent estimate
$1,300

We have been paying $1,250 for two years. (comparable to neighbors)

Identical property sold end of march for
143,647

Property Tax $142 /mo
Insurance $20 /mo
HOA $254/mo it includes Snow/Lawn Care, Outside Maintenance, Hazard Insurance, Cable TV, Building Exterior, Professional Mgmt.
Vacancy 10% $125
Repairs 5% $62.50

We are going to read through the HOA agreement tonight to see what their regulations are for NOO.

Thanks
Jesse