so if the ARV is absolutely positively 425,000, then subtract your repair budget from 297,500.

Someone sent me this email so I wanted to post it less as much of the political spin as I could subtract as possible to get a sense for how much of it is accurate.

That will be a better indicator of the value of your property.Once you have the value, you can subtract out your costs (rehab, holding, purchase, selling) and your desired amount of equity/profit to determine a reasonable offer price.There has been plenty written here about how to do this...keep reading these forums and you're sure to learn a lot...

there are only 24 hours in a day --first you need a well thought out Business Plan -- supply and demand as well as appreciation study for new area-- if homes are selling cheap and rent is high --may not be long before you have competition --Several ways-- Have an LLC and go Private Placement offering--to rasie $1.0 million --and buy 10 to 20 houses in one year---or even six months --if you are aggressive and have foreclosures or fixer uppers available in area- 25K per building ( hosue) - may not be enough and too much paperwork -- too slow process-You need to decide how much your time is worth -what can you make as salary -full time -minimum $80,000 per year - subtract all expenses --car -mileage , meals etc --then project profit and offer 50 % of profit -- alsoneed to consider income taxes --deprecition as well as capital gaines tax--need to run projections over five years -- how many houses will you buy and how long will you keep ?

Subtract the 2400 profit he made by collecting rent, and you have $3381.81 that he can deduct - so essentially just by having this rental property he is shielding 3381.81 of his salary from his regular job, from being taxed.

You really only need to justify when your offer is really significantly lower in my opinion, and it depends on how you do it.If you list the asking price, subtract repairs and arrive at your offer price, then make that as an addendum to the offer, it has usually worked well for me.

So, now subtract off your desired cash flow

After you arrive at a fair market value, you need to take into account repairs and subtract those.

thank you thank you thank you guys.. clarifies a lot. i was wondering if i was already taking 65 percent of the top then how much is this finally offer going to be if i continue subtracting expenses.

So, subtract off $20K and I'd pay $30K for this one.If that triple is renting for $400 a unit, I woulnd't want to be into it for more than $20K a unit, and really more like $17,500.