What should I offer? Advice appreciated!

[Mary Quinones]

I'm interested in a Fannie Mae property which has been in the market for 120 days. It's listed at $119K, having been reduced from $126K a little over a month ago. For what it's worth, Zillow's zestimate is $102K. The house needs about $20K in rehab to make it rentable. Any suggestions on what to offer? It will be an all cash offer. Thanks and be well.

[Allan Rosso]

@Mary Quinones, a decent rule of thumb to use is the 70% rule. You take the estimated ARV (after repair value), multiply it by .70, then subtract the estimated repair amount. For example, lets assume the ARV for that property is $126K:

(126,000)(.70) = 88200. Then 88200 - 20,000= $68,200

Using this, you would make an offer of around $68,200. However, when using this rule, you still need to make sure that your offers are competitive enough, so you don't miss out on deals. As far as this property, it's been on the market so long, it doesn't hurt to try.