1st deal - please help analyze

[Tom Wingert]

Hello BPers,

Please let me know your thoughts about the following deal:

East Indianapolis

$69,000

4 bed 1.5 bath. Tri-level(?) with the largest bedroom and a half bath in a daylight basement. The area below the grade is finished and there are egress windows.

"Turnkey" property and I met the property manager.

Currently rented to a Section 8 tenant paying $850/month.

I did visit the property and it is in pretty good shape and there were lots of repairs made (about $30,000 based on the scope of work they sent).

They had a "front-end investor" for this one who put up the initial cash and called many of the shots. They said their last appraisal came in at $57,000 and that caused the last deal to fall through. For that reason, they said the seller wasn't sure if he wanted to sell, and had me wait a couple days for a decision to go ahead.

The appraisal I got came in at $52,000. However, using the current rent of $850 for the "Income Approach" it was around $62,000.

Please let me know what you think of this appraisal and the deal in general. I've been told that appraisals are coming in low all over the place so that's kind of standard but I'd like to see something more on that.

Looking forward to your thoughts!