28 Unit
Income - $152,160
Expenses - $40,000
24,500 sqft
100% occupied
Separately metered Electric and Gas
7, two story buildings
Newly rehabbed, pitched roof, stainless appliances etc.
65 parking spots
What other info should I post for you experienced guys to evaluate and suggest an offer price?
What’s the price? Are the #'s actual or provided by the seller? You get the actual #'s during your due diligence.
Those are actual numbers. I did not enter a contract yet just wanted to see what you guys thought a fair price is. What other info do you guys need to suggest an offer price?
Need plenty more info but anything 400K or less would be solid on the limited data you have given us.
Limited data?
WHAT IS THE ASKING PRICE OF THE PROPERTY???
Brian,
Those expenses are only 26% of the gross rents, which means I would be waiving the B.S. flag. :bs :bs :bs :bs :bs :bs :bs
Here is how I would evaluate this deal:
Gross Monthly Income: $12,680
Operating Expenses: $6,340
NOI: $6,340
Then, I would subtract $2,800 from the NOI for my cash flow to get the maximum monthly payment: $6,340 - $2,800 = $3,540. Then, I would determine the purchase price that would support a payment of $3,540, which is about $525,000. So, my maximum purchase price would be about $525,000.
Mike
28 Units
Gross Scheduled Income $152,160
Monthly Rent Roll
$475.00
$475.00
$350.00
$475.00
$475.00
$475.00
$475.00
$475.00
$495.00
$495.00
$400.00
$400.00
$475.00
$490.00
$400.00
$475.00
$475.00
$400.00
$475.00
$400.00
$475.00
$475.00
$475.00
$425.00
$425.00
$450.00
$475.00
$425.00
=$12,680.00
Expenses
Taxes $12,320.00
Remember the units are individually metered for Electric and Gas.
Maintenance only $17.85 per unit per month??? REALLY?
Never a vacancy?
No Capital Expenses?
etc, etc, etc…
Mike
It was just rehabbed completely. Now it is a bank owned property. And I included 10% Vacancy in my calculations but I figured you guys would add your own in when running the numbers.
If this is a bank owned property, is the rent roll an estimate of rental income, or are all of the units currently rented?
If your numbers are good, then I am guessing that the bank is asking $40K per door. I am guessing that the expenses are understated, and that your ownership experience will be much more expensive. Let’s use $76K as an estimate of your NOI.
The question is how much can you afford to finance at 8% over 15 years, after putting at least 20% down?
If you want around $100 cash flow per month/per unit, then your debt service can’t cost you more than about $42400 per year. This means that $370K is the maximum loan you can support with your rental income and still cash flow. If you put 20% down, then your maximum purchase price for this property is around $462500 or $16517 per door.
100% Occupied
Actual numbers
Bank owner for 3 years.
Mortgages: all 80% LTV
7.5% for 30 years
6.61% term 5 years amort for 25 years
Variable
Prime – 1% for 20 years
Principle + interest, then it recalculates interest based on principal
and
6.05% 3 year term amort for 20 years
Brian,
I’m assuming you meant 80% LTV which means 20% down from you. The other way wouldn’t make any sense.
You seem to have everything you need. What price are you planning to offer?
I am stuck on finding the right mortgage.
What is the cash flow number you come out with after the mortgage payment?
Commercial is 90/10. What is the DCR or DSCR?
