Appraisal before BRRRR

[Jee Lee]

Need some assistance. I have a home under contract that has significant water damage from a bad roof and the home hasn't been updated in decades. The appraisal came in for $20,000 less than the asking price. Is that normal since the home needs significant updating?

The "deals" in my area (St. Petersburg, FL) are selling for over asking price. The seller has said that people are knocking on her door and offering her cash to close immediately (my offer is also cash) so I'm afraid to lose the deal if I try to negotiate the price down.

Offer price - $150,000

Appraisal - $130,000

Rehab - $50,000 (Fix roof, replace ceilings throughout home, update bathrooms, increase from 3 to 4 bedrooms, knock down some walls, update kitchen)

ARV - $250,000