In order to get the ARV, what if the only comps you find all needed work to be done and all of them were in a bad condition so they sold at a low price, then how do you figure out the ARV of your property?

Instead  of the term "first time home buyer" it is more so "low money down loan" meaning you can mortgage property with little or no money down if you plan to owner occupy it.  

That's way too much unless you basically re-build the whole thing.Second, even with a basement unit, the cap is way too low for 1.3M, especially you are putting 480K cash in reno. 

I know I could try to low ball the offers but it seems pretty consistent in many areas.

I THINK this property will appreciate significantly with what is going on in the neighborhood, but even if it doesn't, I'm confident I can have it rented or sell with a low chance the value dipping below what I paid.I'm not trying to aggressively expand right now...

My husband are new to the game and have an opportunity to buy a neighbors house at a low cost.

I do think we can convert the top to a 3-1 for relatively low cost and charge more for it. 

You go too low and people begin to wonder “what’s wrong with the house?”

In the near future I will be using an FHA loan with a low down payment to purchase my first investment.

That mortgage has to be pretty low right now.