Strategy when making an offer on WAY overpriced building
Hello all,
so I found a 10 units building, that is apparently with 50% vacancy. Not much info except that it is listed with the potential GRI of $70500. it's listed for $450,000 (lol). Not renovated in a while. Roof seems not that old. Laundry hookup. 1bed/1bath. Florida. Not a big city but some job around.
Based on this info, I applied $70,500x0.5=$35250 of actual rent (if rent is being paid...!). Apply a .5 ratio for expense (rough analysis to get NOI)=NOI $17625.
Seems to be a C-ish place in florida. Would apply a 10% cap. so 176250$ which is 40% of the asking price.
My questions are :
- Am I doing a right analysis ?
- Due to the hot market in multifamily, everything is listed too high. How to approach and make an offer without looking like a douche (basically telling in a nice way "your building is not worth that much") ?
Thanks all for the help.
Charles