Hello Mo,
I haven't replied much in this forum but today I decided was the beginning to do so. I know you are searching for a real estate investment transaction and using the MLS and/or a real estate agent. I'm not sure if I missed anyone's reply as to an exit strategy and your intended use for this investment. Did I miss that this is a buy and hold i.e. becoming a landlord? Is it a buy, fix, flip? Is it a Brrrr? RE investing has many ways to ==> profit!
As all RE investors know on "SFR's", is that you make your profit on the way in not on the way out. Let's say you plan to buy and hold and want to become a landlord...A simple metric is to know the local rental market where this property is located (can also be found on CraigsList). For example, if this is a 3/2 two story detached and the real estate professional tells you that rents in this area for these bread and butter 3/2's (under 1,500 sq. ft.) are $1,400 on avg. per month. A simple REI rule is the 1% or 2% monthly rental vs. the asking price....does this property pass either one of these two metrics, if not, assuming everything else is fine with the home and repairs going in aren't necessary or little, then the price point (maybe) where you walk away shouldn't be higher than $140K ($1400/$140,000 = 1%). However, nothing is preventing you, through your agent, to place a purchase offer for $120K or $130K, especially as the DOM continues to grow.
If you plan to buy and hold and this one particular home is in the targeted RE market that you want to be in or have knowledge of, then move a little closer to getting "and learning" about some basic metrics dependent upon your investment intent. Basic formulas or using the BP calculator(s) I'm sure will be beneficial to you. Are there any Real Estate Investment groups in your area?
I was questioning if I should have replied to your question today in the forum. I'm glad I forced myself to do so.
Good Luck.
Dave
