Possibly Off Market Deal but IDK

[Donnell Durden]

First off I'm looking to peruse a 203k loan (basically the bank covers the purchase and rehab)

In conversation an older gentleman I often run into offers me his one bedroom apartment on the first floor of a multi family. He wants to sublet it to me while he checks himself into the VA hospital for some health issues. I never took the offer seriously but he also mentioned that his landlord was renovating the 2nd floor 3BR to be rented and that there's a long time tenant.

So I say "ask him if he wants to sell it" and I kid you not, as soon as I said that his phone rang. It's was his landlord calling him about picking up the rent (today is the 1st)

Do the man puts it on speaker asks. The guy seemed a little put off that his tenant was asking him this but after a brief delay he says "uh tell em we can talk, give him my information"

I want to be prepared before I approach him so I need you guys help.

On either a BP thread or podcast someone mentioned to check the assessor website. So I check and so far that's all I have to go on. I'm not sure what some of these numbers mean and how they can help me formulate a number that makes this home a deal.

First I notice it's listed as a 2 family. Does that mean the 3rd floor dwelling is makeshift? Will I have a hard time officially converting it?

It was built in 1900 like many of the homes in my area and has 2260sq living area

The owner Sam purchased it for $52k on 4/20/2007

2016 assessment $91k

2016 appraisal $130k

Replacement cost?? $119535

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Now how do I turn this into deal?

Since it's officially it's officially 2 units

3 BR=$850

1 BR=$600

=1425

Worst case

Or just $850 (up to 1150) if I house hack (live in one unit).

I'm guessing expenses (taxes, insurance, cap ex, repairs, vacancies) for the area to be about $500 if I'm cautious.

Then a mortgage payment

I've seen the first and 2nd floor apartment via the old man. Both need some updating but are very close to rentable. Lots of wood paneling. House was built 1900. I've never seen the 3rd floor dwelling. But the old man says there's a full bathroom and kitchen up there.

FYI I have like 7k to put down.

Guys what are my next step? What more information do I need to get from the owner or elsewhere? How do I make this a deal? I'm assuming I need to get some Comps (I just learned what this meant) to know what ball park to being. Talk to me BP