Also, the ARV should be after the repair costs are added into the equation already. remember ARV = FMV - RC(repair costs).

I know of tons of cheap properties around but cheap doesnt necessarily equate to a good value thats worth the cost of repairs. so what would you recommend for someone who is totally new to RE as a ways to spot a possible deal?

All of this needs to be put into the equation.

I didn't even factor that into the equation, let alone cash flow, and appreciation.

Your drive time equates to 2 classes each day studying REI.

Repairs are a MAJOR part of the equation.

Question: The 70% formula for ARV and making offers.Your investor says he want at least 30% equity in the deal for him.So the property you are looking is asking for 275,000.The equation works out like this right:275,000 *.70 - repair cost - your fee = what you can offer to the seller right?

I don't know the other varibles in your equation i.e. appreciation rate, age of the home, any other deferred maintenance, overall characteristics of the neighborhood, rent comparibles, ect...But my gut feeling is that with the recent fall out of the sub-prime market, this is the best time to purchase rentable properties.

You need to factor that into the equation.

One thing I need to do is figure out how the closing costs fit into that equation.