Determining MAO on $389K list price

[Britt M.]

Hi BP,

I found a great house in my neighborhood. It's listed FSBO at $389K. Owners are motivated and want to unload the property. They've only posted external photos which leads me to believe it's a wreck inside (it was built in 1933 and further work done in the 80s).

Comps/recently sold in the area are $400K+, however these homes are in much better condition and have significant remodeling.

Should I base my MAO on land value. This is an ideal tear down and could put at least 2 homes on the land.

Any guidance is appreciated!