How to analyzing rental deals without a pro account

Question

Good afternoon all,

What is a good resource or formula to use to analyze rental deals?  I know the best way to analyze deals would be to upgrade to a Pro account but that is not feasible for me right now.  I would like to get some practice at work while we are slow.  Is there a website with a formula that I could use?  Also, what are the most important numbers to use?  I know rent price, insurance, utility, taxes; anything else?  Thank you guys for your time and sorry about all the questions.

Nick Peters · Answer

Hi @Marvin Hudson

Marvin Hudson · Answer

Awesome, thanks everyone!

Tim Herman · Answer

@Marvin Hudson Their are spreadsheets in the files section that will allow you to analyse properties, Free to download. Their are 2 types of costs. Hard and soft. Hard costs are known. Taxes,insurance,principal and interest, management  and utility costs if paid by the owner. Soft costs are variable: vacancy, maintenance, and capex.All costs have to be accounted for. I use 8% for vacancy or 1 turnover  every 12 months, 5% maintenance or $50 per month whichever is higher, 10% capex or $100 minimum whatever is higher.

Tara S. · Answer

So I am in NJ so my cheat sheet may differ from yours but here a quick cheat sheet I give to my clients. Its not an exact science but its a place you can start while you figure out your area.

70% of ARV = Mortgage (use the mortgage calculator on google)

70% of ARV minus repairs = cost

Insurance - $50-$75/door

Cap Ex - $50/door

Vacancy - $50/door

taxes divided by 12 = 1 month of tax costs

Property Management fee = 10% of rent

Bills minus expenses = cash flow

ARV minus Repairs minus Costs = Break even Offer