about to make my first offer in the DC metro area...MD

[Daniel OKeeffe]

So, I am working on an offer that will have to be submitted tomorrow if I am going to offer. The asking is 199k on a Rambler w/ 3/2 but the 3rd bedroom and 2nd bathroom are in the basement and a little over 1k sq ft above ground. They are asking about 198 per sq foot but I dont think it will sell more than 265k once its finished up. The problem is I dont know the costs yet for the rehab but have been told to expect as a general rule about $15/ sq ft. Its also "cash only" which to the RE agent means cash but to me means no finance contingency. Am I wrong? Should I offer around 135k if I am gonna follow the 70% rule and put in a contingency for inspection with assignment language to give myself the option to wholesale? Any help is appreciated.

[Sekelle O.]

I am also in the DC metro area. Not an expert either but I usually estimate $30 per sq ft for repairs, until I can get a contractor to walk through the property with me and give me a better estimate. The $30/sq ft usually gives me a pretty good ballpark figure for medium rehabs. If the property is in really poor condition or requires a high end rehab, I up my estimate to $50 per sq ft.

In my experience "cash only" usually means the property won't qualify for FHA or other traditional financing either because of condition or, as in the case of a condo, the condo association lost its FHA approval. If you are using a hard money loan, then you may want to include the financing contingency and select private lender as type of financing.