What should I offer?

[Norm M.]

This is a 3600 sqft, 5br/2 bath older house with two rentable 1br units in the back in a detached building. My strategy would be buy & hold. Owner occupied for a year or two before finding a real place for my family.

Asking is 450k and its been at 450k since last april. In total its been on the market since sometime in 2010 (original asking was 625$).

There are no exact comps.. since this is unique in that it has a house with a detached structure for the rental units.

The closest comps are either 2 family houses (350-450k), 4-6 unit apts converted from huge houses (at lowest, about 100k per unit, ~100/sqft, avg maybe 110/unit, 130$sqft), or local SFRs (~320-350).

The 100/sqft ones were mainly in early to mid 2011, 100k/unit (mixed 1br-2br) also was in mid 2011.

This particular house is in a more commercial and less desirable part when compared to some of the other comps.

I was wondering what was a reasonable starting offer - should I go for ~ 105/sqft and start at 380k? and try to aim for something like 400 or 420?

in terms of metrics:
380k -cap@ 7.5, CoC@11.5,
400k -cap@ 7.1, [email protected],
420k -cap@ 6.8, [email protected],
450k -cap@ 6.3, CoC=8.2

The numbers aren't as good as ones you guys post, but i think reasonable for my area. Any suggestions for a good bidding strategy?

Thanks!