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Updated about 9 years ago on . Most recent reply
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No Recent Comps for a Small Multifamily (2-4). How to offer?
So there's a small multifamily house (2 units) for sale in my area that I am interested in. However, I feel like the list price is inflated quite a bit for the area. The MFH is listed for $265,000 and when I run comps for SFH the average sale price is about $160,000. How would you go about making a competitive offer if there aren't any recent comps for a MFH? Do you use the average price per square foot for the zip code? Do you look at SFH comps in the area? Any input would be very helpful.
P.S.- I do not have access to the MLS.
Most Popular Reply
You should never pay based on comps. Offer what it's worth. Take current income from rents, if occupied, or market rents. Then all expenses. Work with the numbers until you get a return on investment or cash on cash return of whatever percentage you are seeking. I personally look for 8-10% at least. BP has an analyzer you can use for free or there are spreadsheets online that can be used for your due diligence.