If those bids and condition reports come back to my satisfaction, then I move forward, if an expensive repair item is uncovered, I either back out or re-negotiate based on the findings.

If the appraisal doesn't come in high enough you are hosed, inspection uncovers something you didn't account for you are hosed, and you run the risk of his financing falling through as well. 

Statues: ActiveYear Built 1932* Income/Expense Info Actual Total Number of Unit 5 Zoning C-1 Annual Gross Income $30720 Vacancy Factor 1.00% Cap Rate % 0.13 Total Annual Expense $2224.08 Annual Net Income $28495.92 Parking Uncovered Also expenses are only about 7% of gross income which is in huge conflict with 50% rule seen in this forum.

I believe after repairs this home will sell for much more)The renovations would include: an extended and upgraded kitchen, combine 2 of the rooms to make one big master suite with walk in closet and and a master bathroom suite, adding a bathroom, uncovering and refinishing all of the original hardwood floors throughout the entire home, add on back screened in porch with an additional open deck off to the side, new fencing and landscaping, a new roof and some modernized upgrading to the additional rooms.

Your negotiation may be eye opening to the seller and you may get him to justify lowering the price due to the risks you uncovered.

I believe what you are asking is just the first of what you will finally uncover to see if it is a path you want to take.

Adrian Tilley Great job in uncovering a great opportunity.

Direct Mail, canvassing neighborhoods, driving for dollars, bandit signs, wholesalers, HUSTLE is what you will need to uncover viable product to capitalize on.  

Just compare how fast hot water cools in an uncovered styrafoam cup vs a covered one for proof.

They may uncover some things a GC may not even notice, and in the case they find something major that $400 investment could save you thousands if you choose to back out or re-negotiate the purchase price to reflect those damages.