Deduct NEW property taxes after you buyDeduct home insurance costsDeduct maintenance percentage, typically 10%Deduct vacancy+tenant nonperformance percentage(we recommend 5% for Class A, 10% Class B, 20% Class C, good luck with Class D)Deduct whatever dollar/percentage of cashflow you wantNow, what you have left over is the amount for debt service.Enter it into a mortgage calculator, with current interest rate for an investment property, to determine your maximum mortgage amount.Divide the mortgage amount by either 75% or 80%, depending on the required down payment percentage - this is your tentative price to offer.If the property needs repairs, you'll want to deduct 110%-120% of the estimated repairs from this amount.Be sure to also research the ARV and make sure it's 10-20% higher than your tentative purchase price.As long as the ARV checks out, this is the purchase price to offer.It is probably significantly below the asking price.

So this really depends on what is the underlying collateral.. is it C D class props that are going to be beat up and tough to sell ??

Much like a mailed check/money order is "paid" when it is post marked as it isn't the tenant fault if 1st class mail takes 3 weeks (which actually happens sometimes!).

We talking rough area or working class? 

totally disagree this is important for those who actually are in construction or rehab houses to understand the labor force and not discriminate against a certain class because of who they are or where they are from.. 

You should teach a class on "How to Lease a Property". 

As world economics and geo politics have become more of a constant, this Teak investment will serve for diversification in asset class, maturity- since you don't have to harvest, currency arbitrage since main customers are China/India/Europe. 

In the very beginning of the flip I would buy everyone food at lunch, I would cook on the grill for the crew and buy beers.

What is the class of tenant?

Start with B-/C+ properties for Cash-flow so you can buy the class A and B properties for apprecation.