found a prooperty that the town has told the buy to sell it, fix it or mow it down. I checked this out. It's about 75-100 ftof water front on a pond/lake that is small and has motor boats and other waterfront properties. If I priced as land it would come around $115 or so. To price both it would be about $215 with $75K for tie-ins and rehab of the ouse. I think the bones of the house are good so I figure someone rehabbing could do it for $100 and end up with a comparison of $290 or so. So, how do I approach the owner? Tell him I have a verbal offer of land for $115 or $200 and 75 back for prep and rehab. How do I get him to bite? I really want this...the lake is decent.
Thank you in advance.

Please consider reading your post... re wording it for clarity and then maybe some one will understand it.

You may find that it would be better posted under the investment forum.

Other than my numerous typos I thought it was understandable...sorry

I tried hard to follow too and couldn't. I also don't know what a tie-in is.

I got this much...
Waterfront property with a house in rough shape. Land value is $115. Might take $100 to rehab the house (100 thousand dollars, really? How big is the house???) After that, the house and land should be worth $290 (after spending $100 on rehab, the house is only going to be worth $290???)
Are you a Realtor? If so, you're going to need to be honest with the owner about the value of his land. You will land yourself in trouble if you "try to get him to bite." Cases similar to this crop up all of the time at ethics hearing panels.
Otherwise, if you are not a Realtor, and you just want the home... How much is it worth to you? Offer the owner what it is worth to you. Find out what it is worth to the owner. Does the owner have any cash to fix it? Does the owner owe anything on it? How much does the owner need to find a new place? Use those figures to come up with a reasonable offer.
--A

I admit I wasn't clear. I feel the land as it is is worth $115K...it comps with another in the area. The house on the land many will think needs to be razed. HOwever, after being there twice I find that the house has a good walk-out foundaton, good roof rake and good side walls, which is my way of saying "good bones". It has public water and sewer. So, my way of analyzing this was to set a price off of comps of being about $275K for a finished home similar to those in the area, remembering it is waterfront.I would guess that would mean I'd have $150 to rehab this house. Obviously I'm working backwardds on the figures. I would like the property either for myself or a listing. My question is how do I present it to the seller fairly for him to not feel insulted, or feel he can really get a million bucks for it?

Better? Thanks in advance.

First decide if you are going to live in it or sell it,that will decide what approach you take.

What would the property be worth if you spent $115K for land and $150K for the rehab? If the answer is $275K, then there's no profit in this from an investment standpoint.

Unless I misread your posts, you indicated that the rehab costs could be $100K or $150K. That's a huge difference. Are these your estimates based on your experience with prior rehab projects or did a general contractor give you these estimates? Natually, you need reliable cost estimates to evaluate the property potential.

These are simply estimates based on my limited experience and the experience of many that are well above limited. Maybe the figures need a re-work. My intent was to sell it. 150,000 and 15,000 is $165,000...house can sell for 240-265...so there is a profit on doing it this way...right?

Just going back on some reponses...first the owner lives 500 miles away...he's been told by the Board of Health to fix it or dump it. I am not, NOT trying to pull anything unethical over the owners eyes... please don't assume that of me. You don't know the fact...I've tried the best I can to describe them here albeit the first one not being too clear. Thank you for your efforsts at repsonding.

Generally speaking, if your purchasing costs plus rehab costs plus holding costs plus sales costs plus the profit percentage you want to make plus a small contingency factor for unknowns totals less than what the property can sell for at retail value, then that is a deal worth pursuing.