Posted by Richard on February 25, 2002 at 20:07:18:
Answer his question with a question. For example, That will depend on the property and your situation, tell me is there any existing financing on the property, what is the amount / percentage rate?
This way you will be able to determine how to structure a deal that is win-win. Also you should have some knowledge of the marketplace prior to entering negotiations. You should put together an analysis of what is will take to rehab the property. Sometimes giving the owner full asking price is good if you are getting good terms.
But as for a starting point if the seller does not want to open the negotiations armed with your knowledge of the marketplace, total cost of ownership including rehab, and a market analysis of comp sales in the area (you can get comp sales from any broker, or by going to the county court house) you should feel comfortable making an offer. Aim low who knows what the seller will take, or make the offer on a letter of intent listing 3 ways you would be willing to buy the property. (a mix of price and terms).