First offer was a flop! Any ideas for my next one?

[Craig Herring]

Well I put in my first offer on a 3 unit MFH this past week and it was rejected...without a counter offer...and was told my offer insulted the seller!

Although I knew it was a low ball offer and didn't expect my first offer would be accepted, I was still pretty excited pursuing my first REI deal.

The numbers are below but here are 3 things that I think I can do to improve my chances next time:

1. Don't offer an even number - to show that there is reasoning to the offer (ie. $103k instead of $100k)

2. Explain my numbers to justify how I got to my offer.

3. Include a personal letter with the offer so that the deal is more personal instead of cold or robotic.

Do you guys/gals have any other ideas to help improve my offer success in the near future?  I'd love to hear your input.

Regardless, I will keep looking for deals and hopefully land something soon!

3 Unit MFH (1-1 bed, 2-2 bed)

Asking $184,900

Current rent $1750/mo (2 units were way under rent by ~$150 ea)

Pre-inspection Est repairs $20,000 (roof, very old termite damage, possibly exterior siding)

Conventional financing w/ 20% down.

My offer $100,000

At $100,000 with current rents = CF $95/mo  COCROI 2.7%

At $100,000 with $2100/mo rent = CF $319/mo COCROI 9.1%