How much below listing price should initial offer be?

[David Rutledge]

Hi Everyone,

I am ready to put in an offer on my first buy and hold investment property.

I have heard time and time again in all my research that you make your money when you get into the property so I am very aware that I need to make sure that I get the property for as low as possible.

I have never put an offer in on a property before so I am looking for a little guidance on exactly how low I should go with my initial offer. I understand there will more than likely be a little negotiation from both sides so I want to have my initial offer be lower than what I am willing to pay but I also do not want to put an offer in that is way under market value and have the sellers not take me seriously and completely dismiss my offer.

I am looking at mainly multi familys and from what I have read it is easier to get a discount on the mutli family so maybe my initial offer should be lower if I am trying to purchase a multi rather than a SFR.

I also understand it depends on the market/how long the property has been on the market for etc... but I would like to get some general rules of thumb to kind of guide me if possible.  I fear the agents that I am using are not as experienced with investors so I would love the input of the BP community on this. 

Can anyone give me some advice on how you guys go about coming up with that initial offer?

Any guidance or help on this would be greatly appreciated. 

Thanks so much for your time.

David