This looks like an awesome deal but formula says otherwise!

[Angelo Mart]

Case Study:

I found a property located in a very wealthy area (Red Bank) that is an estate sale with highly motivated sellers that is being sold in "AS IS" condition. The sellers (of estate) need to push this property fast and just reduced the price from $520,000 down to $405,000 and wont really budge as they have to pay a REVERSE mortgage off. I have reviewed and verified three recently closed homes on the same street that were completely renovated but were similar in terms of size (within 200 Sq.Ft.) room count and lot size (as per city assessor) to this property. One sale was at $590,000, $625,000, $700,000 and the house next door sold at $665,000. My estimated cost to cure/repairs is estimated at $60,000. I am going to utilize transactional funding for this deal as it seems the best solution for wholesaling. I offered $360,000 and they laughed at me!!! What is the most I Should pay for this property as I want to make a minimum of $12,000 on the deal. If I estimated the house at $665,000 (most similar comp) and use the formula of 65% of that would be $432,250 - $60,000 - $12,000 = $360,250. However, an investor (rehabber) friend of mine in the area says that his company does not do a deal unless they make a minimum of $90,000. In this case they could make ALMOST $150,000-$200,000 even it if pay full price of $405,000 as the formula does not appear to be consistent in this high end market. Somebody PLEASE help me to structure this deal, I don't want lose it. THANKS BP