What to offer for property ?

[Jasper Henderson]

I'm currently looking to purchase a home with a desperate seller. I've watched the home for a little over 5 months now and its yet to be sold. it's one of the cheaper houses in a neighborhood that averages around $180,000 plus per home whether 3 or 4 bedrooms. The seller wants $154,000 for the home, they moved from NC to Texas for a job opportunity and are still paying the mortgage. I've done a tax search on the home and discovered the home was purchased in 2012 for $146,000. it was just built and appraised earlier that year for $149,000. The home has been occupied for the last five years meaning there is equity in the home. What's the best way to calculate the current payoff of the home ? What would be a great offer to start with ? 

3Bed

2.5Bath

1,601Sqft

.26Acre lot

Seeing that the home is fairly new its in great condition. There are still valid warranties. its in a great school district, close to a major highway. less than 2 miles from a police station, and right outside of downtown. i'm also looking to buy it to rent out if that helps.

[Account Closed]

Take tax appraisals with a grain of salt, they do not reflect the current market value and it sounds like that neighborhood can support the purchase price. Unfortunately the first 5 years you are paying a good chunk of interest on the home. My suggestion would be to find out the mortgage amount so that you can try to guess the type of loan that they used for this property. Take the purchase price and compare it to the mortgage history to see how much was financed. I would then make a guess based on that number that they went conventional, fha, va, etc. You can throw all of that info in an ARM calculator online and try to get an estimate of the money owed based on that calculator. If you are looking at it as a sole investment property then you should def. run it through and make sure that all the numbers make sense. I would start with...at what price would this make a good rental but not offend the sellers?

Good luck!

[Jason Chen]

Start with $105,000 and move up to maybe $120,000?