Off Market Buyer offering to Out-of-Touch Seller

[Wynn Williams]

Howdy! My wife and I are looking to offer on our first investment SFH in the same neighborhood we currently live in. We heard about these folks looking to sell their property. Today, I had an inspection, appraisal and a contractor give me some estimates on repairs. The house is trashed out and needs a lot of work. A little over 1000 square feet, Pier and beam foundation that needs some further examination, old cast iron plumbing will likely need replacement and water damage near/under bathroom tile, substantial rodent damage (2-4" holes eaten through in multiple spots), and a whole lot more including potential roof replacement and an HVAC from 2007.

The sellers have $300,000 in their minds because 6-8 months ago, this was common in this neighborhood, but given the money that will need to be poured into the renovation, there’s no way I can come close to that number if i want to be right side up. How do I approach this conversation without being insulting or help them understand that the market has shifted? Again this is our first investment. Not afraid of the project, but my offer is going to be much lower than what I think they have in mind unfortunately.