Asking price: 53,000
Comps in the area: 71k-115k
ARV: 75,546 (calculated by added sale prices and tax assessment of comps. Then sale price/tax assessment = multiplier. multiplier x tax assessment of target prop = ARV)
25% of ARV: 18,886
Est. repairs: 3000 (Haven’t looked at it yet but by the pictures it seems to not need any repairs or major upgrades that I can see. So, this might change.)
Assignment: 2,500
Offer: 51,000
Because the calculated offer is not much off their asking price, I might start with a 40k offer, work from there and get closing costs paid by the seller. FYI, it looks like it is being sold by an Invester and its listed in MLS.
Your calculations are flawed; tax assessments cannot be used in place of reality! The subject property might have been assessed in a whole different millenium than the surrounding properties (like in 1999)!
However, if the seller is asking $53K you could probably get it at $51K and it will still work. Are you assigning it or getting it assigned to you?
I know sometimes the tax assessments can be off, however, it does give a good starting point when you average 6-10 properties together. All of the arv’s I’ve done this way come out pretty accurate. (so far)
I will be assigning it and will more than likely start out lower (around low to mid 40’s) than my target purchase price (51k).