Should we wait or go for it?
Hi! We are currently renting and the house we are living in is about to be sold so we need a place to live. We are not looking to get into a huge mortgage as being mortgage free one day is our goal.
We are looking to start buying rental properties until we can make enough equity and save enough to put down on a piece of land.
Here is the property we are about to make an offer on. It's a 1/2 duplex 2 bed 2 bath. It's listed at $110k. In our area, we should be able to get $1100 for rent. To make a cash on cash ROI of 9.4% and cash flow of $208 (including taking the property manager's percentage,) we would need to buy for $85k. It has been on the market for almost 200 days.
I wanted to offer $78k at first with 85k being the most I'll pay. My realtor thinks this is an offensive offer. Should I care about being offensive? He wants to offer $82k to start. This seems to be the literal only good deal in my area. The other option right now would be to keep renting or get into a mortgage which we really don't want to being as most of them are listed for their top price.
Is this a good enough deal to get started or are we jumping the gun?