First property - interest in HUD duplex - wondering what to bid

[Jesse M.]

I've been looking for my first property for about three months now. I want to buy a duplex or triplex. 

The one I really like right now is a HUD duplex. It's asking price is well under what duplexes typically go for in this area, even taking into consideration the cosmetic work it needs. I'm wondering what sort of competition I'm going to be dealing with, and what my bid should be?

I should mention that it is exclusive to owner occupants, like myself, before investors. So, perhaps that eliminates some of the cash-down investors with bigger budgets than myself.

I called the HUD listing agent and found out from her secretary that there have been multiple bids placed already. I'm just wondering how high above list price I should go, if I should go higher at all?

My realtor says these properties often go for "well above" list price. However, I'm fairly certain she has no experience at all with HUD homes, and dropping her as my agent is not really an option..

The realist in me is concerned of the many unknowns when dealing with these foreclosures, and it a big risk for someone who's just getting started, could end up being wasted money to investigate those unknowns. HUD makes it very clear that they DO NOT promise the property condition report to be true, per se. Does anyone know how thorough their inspection is?

The ambitious, and possibly daydreaming, investor side of me sees the potential, and the money that could be made when I make this into my first rental property. In fact, when I crunch numbers, it's he only duplex I've looked at so far that would cash flow while I'm owner-occupying the other half. It just might be worth the risk. 

Thoughts?

Thank you in advance, any advice would be valued and appreciated