Possible Home Run..

[Edward F.]

What should my Max offer be on this property??

Should I buy?

So my great aunt is getting up in age and her property is for sale, to me specifically at the moment. I have until the end of 2014 to purchase it before it is placed on the market. The amv is 97k. However the home isnt in market condition and needs a lot of minor repairs. i had some estimates run on the property and the numbers came to about 20k in repairs before it is in market condition.

corner lot.

house is on .25 acres and 1900 sqft total.
2/1 1100 sqft unit 850 rent (rentometer)

1/1 800 sqft unit 650 rent (rento) meter

total potential rent 1500/mo

also has 2 car detatched garage.

976$ taxes

86$/mo insurance

Im struggling trying to determin how much i should offer considering its "family" ive been told that I would be able to purchase the property for 73k (taxable) value.. I have a hard time believing anyone would buy at that price considering the work needing to be done.. HELP NEEDED PLEASE.

[Joel Owens]

"2/1 1100 sqft unit 850 rent (rentometer)

1/1 800 sqft unit 650 rent (rento) meter"

You would really have to drill down and see if those rent numbers are accurate or not. Rent depends on location. Urban, suburban, rural the rents change by as little as a block in urban core. The next issue is if the way you want to set them up would be legal rental apartments or would you have to do a ton of work to them??

WHY would you be putting 20k down on a 73k property?? That comes out to 27% down. Why not look at a quad for FHA at 3.5% down?? Better breakeven occupancy with 3 renters help pay for your unit so you can live rent free. The loan is assumable to qualified buyers down the road which will be a bonus in coming years.

I think you will find more expenses than you think on the rehab. Personally in a family situation like this I wouldn't touch it. Not much to gain and a lot to lose. the great aunt sounds like they are saying 20k work so we will give you this price. They are not factoring the time and energy needing a return for equity. WHY would I buy something at 73k needing 20k of work for no forced equity when I can just buy something already completed at that price?? I save time and energy.

You can show them your goals and numbers and why you can only pay XX price for the property. If they balk you might just say I love you more than money and value the family relationship so I think it's best the property is sold to someone else.