Need help analyzing a rental property deal 2-family

[Tim Wilkinson]

Hello all,

I am analyzing a possible deal from a call I got from a bandit sign ad on Craigslist. I will give you the facts, and a couple assumptions. I will know more by EOD tomorrow after I meet with the homeowner and the City office. This is considered a low income area, as the home had a $67,000 HUD paid rehab ten years ago that included deleading, new windows and roof and doors. That will have to be paid at close.

Facts: 2 FR: Unit 1 : 2/1 900sf  Unit 2: 2/1 900sf

ARV 150K based on several comps

Rental Income: 900x2=1800/mo

Cap Rate: 9%

Assuming I could freshen this house up with paint, carpet, minor repairs for less than 15,000

70% ARV=$105,000 -15,000 rehab - $5,000 (closing and moving allowance for current owner)=$85,000 max offer

Does this sound right? 

Secondly, I am wondering if this isn't a better property to do a rental wholesale analysis on and try to unload for a quick 5K and let the landlord figure out how much they want to do. 

I would love to hear feedback from experienced rental flippers and wholesalers. Thanks in advance.