So we have been looking for our next investment property and we have found a run down house in an up and coming area.
It's priced between $349k and $370k. Best offers by COB Monday.
The agent like us agrees it's really just land value, however the other interested party (yep the agent said there's only 2 of us) are tradies and want to renovate it.
But land value, comparable properties average out at $577 per square meter, but that puts this house/land value at $279k.
Thing is, we could either subdivide and build 2 townhouses or just knock down and build one house and at $349,000 (lowest end of advertised price which agent says is their bottom line) we would still make between $60k and $120k.
So my dilemma is - what do we offer? Ignoring there's another party interested as that won't sway us to up our offer, would you offer close to the 'bottom line' of $349k as the agent told you the seller won't accept less (factoring in he could be lying / exaggerating) and we can still turn a good profit,
Or offer closer to the $279,000 because technically the house / land isn't worth much more than that based on comparable sales???