Critique how im going about this deal

[Ceasar Blackman]

I sent my first mailing out to an Orlando zip code i found to be lower end. Ive gotten a 10% response rate so far. I lead sounds like I'm on the right track. I spoke to seller asked why hes selling, whats wrong with the property, how much hes looking for. I got some comps without MLS so i used willow, truila, county assessor . He was gave me his idea hes looking for 35k, mean while its rented for 725 per month not too bad. The tenants are month to month. I check the rental rates in the area and his is slightly under priced. The home is a 2/1 sqft 1002, block build, built in 1956. The condition he told me was that the bathroom needs work and so does the kitchen, he mentioned countertops. In some of the cash sales in the area ranged from 18k to 38k. WIth that in mind i called today and set a tenative appointment for next saturday. Thats when my friend is free that can help with estimating rehab cost. What else should i be doing ? Feels like im missing something

I have placed ads looking for cash buyer and have gotten a decent response without having a property so i dont think selling this deal should be a problem.

Am i missing anything ????

[Nick G.]

@Ceasar Blackman I wanted to get opinions on what u and I were talking about from BP, So......

I wonder if the $725 rent is a realistic number for pine hills...if so...

If someone got into this property for 25k, put 10k in it....now your ARV is 35k.

The total yearly income for the rent is $8700 based on that rental rate of $725.

Now figure a 25% vacancy rate to be safe and you're at $6,525 a year.

Minus $1,000 (insurance and tax estimate) ur at $5,525.

Now calculate the ROI by taking the yearly income from the investment $5,525, divide by total cost of house $35,000 you get 0.1578571428571429 - move that decimal over 2 spots to convert to % and ur looking at 15.7% ROI.

That's a pretty good return, I was told average is 8-10 %. Although the quality of tenant could be a headache with Pine Hills.

Do these numbers sound right? Am I being conservative enough?