The market will determine price
When looking to purchase an investment property, you will want to make sure you don’t pay too much. My strategy is that I am always looking for motivated sellers. These are sellers that need to sell their property for one reason or another and they just haven’t been able to and they are running out of time. The major consideration for what you pay for a property will be the current market conditions in that area. Is it a buyers market or a sellers market?
A buyers market exists when there are lots of properties available in a particular area. Since, there are lots of properties available for buyers to look at, they can negotiate a better price and on other terms and conditions. When buying in this market you can usually make an offer well below asking price and you only need to purchase if you can get the property for what you want to pay.
A seller’s market is where there are only a few properties available but there are a lot of people looking to buy. This means that the seller can usually get close to what their asking price is and they can usually sell a lot faster. When buying in this market you are going to have to offer closer to asking price and maybe negotiate a bit on terms.
In either market, you will want to look at comparables to make sure you are still getting a good deal from a motivated seller.