But what the VALUE is, I can't say I'd know more, other than looking at nearby homes and determining what it cost to build the house, then subtract that from something like a Zillow estimate to determine land value comps.

I normally calculate the market price, subtract my profit, and rehab costs in order to come up with my offer price.

Not sure how much of the $1450 is P&I, but the 50% rule says you take half the rent ($850) and subtract the P&I part of your payment to estimate cash flow.

If your profit is 50/50(which could be fair) you need to subtract his commission, you match that amount from the proceeds, then split 50/50.

If there is a chance I can get it for that price or less, I'll then look at rent-ready repairs and subtract them.

BiggerPockets has a great calculator, you can enter in the gross rent and subtract all the necessary items to get a good idea of what your cap rate will be and it will be much easier to understand when you’re plugging in your own numbers.

@Amy Ranae  I got the number by subtracting your vacancy (0.1*Gross Rent) and operating expense proxy (0.35*Gross Rent) from your Gross Rent

You subtract that and you should have expenses at $485, cash flow $265 and cap rate at 4.54%.

and subtract it by 30% and thats my price I look to offer the buyer.

If the tenant signs another long term lease I will give a discount on that rent increase because I will subtract the turnover costs from the rent increase.