Since I’ve been visiting the site there are forumala’s that we see over and over again. For instance how do you figure out how much is the maximum price to offer on income producing properties? The 45%-50% operating expense to think about when figuring if property will cash flow or not.
Let’s say for example that you come across a property 3 units. There is 1 3-brd renting right around market value. A 2-bedroom renting around $50 below market rent and finally a efficiency (which could be a 1-bedroom with addition of window in bedroom).
When doing calculations do you experienced investors use actual numbers or do you say in your head and on paper I know I can rent this apartment for xxx.xx, with the addition of the window the 1-bedroom can rent for xxx.xx and I can bump the rent up on the apartment to xxx.xx. Curious as I figure if property will cash flow
Does this question make sense?