Seeking advice on my first deal

[Blake Washington]

Hello everyone,

Blake here in Frisco seeking advice on my first investment deal. My fiancé's mother lives in Lovell Wyoming and has decided to retire and relocate to Florida with her new boyfriend. (Go Mom lol) In result she has decided to sell us both of her current properties in Lovell. She is willing to sell them both to us below list price. Both houses are also next to the local elementary, middle & the local high school in their area. Perfect location! 

So now I am stuck! How do I determine this is a good deal? I ran the numbers and it yielded me a negative cash flow of $985 per month?

How is this possible if she sells it to us below market value? It also yielded a negative 29.57 ROI> Am I missing something here?

I would greatly appreciate it if there are any experts out there willing to help me out with these deals or walk me through the analysis portion calculating the expenses to see what I am missing.  I assumed, if we buy below market value we should yield a profit?

House 1: 2bd 1 ba spacious corner lot listed on Zillow for $170,000 ($150k is still owed on the mortgage) Garage Detached -  Zipcode 82431

963 sq ft  Lot Size 7,000  Built in 1929.

Purchase Price (Mothers Grace) $140,000 - $150,000

Taxes Annually $9600

Insurance: $2,200

Renovate: $15,000

ARV $185k-$195K per comps

Current Rent (Nephew) $500

Rent (Per Zillow) $1,180

House 2: Zipcode 82431

3bd 2ba    Lot 0.26 acres   Attached Garage

1652 sq ft  Built in 2015

Zillow $293k

Sale Price 200k

Cal Results:

-391 Month

Income $1,800

Expenses $2,191