You'll also want to ensure you have a good property manager to look after the upkeep of the property if you are not there to notice anything deteriorating or which may need attention.Creating an LLC in California could cost you a minimum tax of $800 every year.

@Tim JohnsonThere are essentially two ways (and a few variations) to purchase this deal, depending on how the owners are selling it:As a going concern:  In this instance you are buying the business, so it is the business you evaluate: assets, liabilities, revenues (historical: 3 - 5 years), operating costs (historical: 3-5 years), future financial projections, goodwill, etc.    

You'll be subsidizing mortgage with renters and splitting the rest of costs with him.

You will stand out from the competition and the incremental costs will be recouped quickly in your low vacancy numbers…  good luck

Comparing quotes will help you identify the most cost-effective option.2.

From there you'll need to determine Debt Service (if it's a financed deal) and Capital Expenses, to then calculate Cash Flow.The Cash-on-Cash Return (CoCR) will just be Cash Flow divided by the All-In Investment (Purchase Price + Renovations + Closing Costs + Wholesale Fee).If you're wholesaling these deals, I recommend you aim to offer your buyers a Cash Flow of no less than $250/mo and a CoCR of 10% or higher.

AI can connect you with our cost segregation specialist if you have any other specific questionsGino

The repair costs will take multiple years to recoup and with the age of the property I'm concerned if it's even worth holding long term or get out while I can before I fall into a money pit and get stuck.  

Emphasize that your offer reflects the necessary repairs and the costs associated with fixing up the property.

I always hear that it is the least costly.