Help me convince my friend this property isn't a good deal. or tell me why it is

[Brandon Reid]

1607 W Hadley st Phoenix for 81,000 (House is listed for more but this number will be the price)

I tired to explain to him that houses on MLS for a long time are not bought for a reason and there is too many smart peoople looking at MLS daily for a deal to stay there over a few months.

His goals for the property are renting it out monthly for 1 percent of purchase price and 7-9 percent cap rates. The numbers he has shown me work on this property. I know this forum is all about the 2 percent rule and 50 percent but he doesn't bleive that is possible yet.

He plans on renting to section 8 and holding the property for 10-20 years.

Why is this property not selling on MLS? What is he missing that everyone else can see?

Please help me stop him from making a mistake or convince me he isn't

Thanks everyone here I have loved learning from all you RE tycoons.

GL finding those deals

[Account Closed]

Long term MLS listings in a hot market like Phoenix are suspicious. More likely the price is too high and seller is not motivated. What do the comps in the neighborhood say? Is the neighborhood in decline? Any upcoming zoning changes? Big hidden repairs? Could be a lot of reasons.

If the home is fairly priced, confirm the rents. I would not accept 1% on a low priced property. You can get 1% on higher end newer homes that will hold value better and have lower maintenance costs. I would assume the $80K home is older.

You could make an offer, go do the due diligence and find out. Just have the contingencies that allow you to back out.