Rental Property Investor · London, Ontario · Member since 2016 · 79 posts · 19 votes
Hey guys,
Does anybody have a process they follow to gather specific income/expense numbers when searching for an investment property? I need proof of the utility bills and previous rental income, otherwise I'm just taking the owner's word for it and running numbers that could give me inaccurate cash flow.
The duplex I'm looking at in London, Ontario is currently vacant, but he says that it was getting $1000/month income per unit.
He also said that the Heat/Hydro were $350/month, but I don't know if that's just during the warmer the summer months, etc.
For utilities I am not sure unless they can provide the bills to give you an idea, or maybe talk to neighboring owners. I try to knock on the neighbors doors to get a feel for the area, the current owner/tenant etc.
As for accurate rent, I would compare the unit and the location to what is listed online or kijiji to give you an idea.
My duplex or if im looking at one, I try to have separate utilities to have the tenants pay for them so they can have as many fridges as they like!
For utilities I am not sure unless they can provide the bills to give you an idea, or maybe talk to neighboring owners. I try to knock on the neighbors doors to get a feel for the area, the current owner/tenant etc.
As for accurate rent, I would compare the unit and the location to what is listed online or kijiji to give you an idea.
My duplex or if im looking at one, I try to have separate utilities to have the tenants pay for them so they can have as many fridges as they like!
For sure, I'm a big fan of knocking on the neighbour's door and hearing what they know. I've spent a bit of time looking on Kijiji, it seems close but possibly a bit high. A copy of a previous lease showing proof of income would make me most comfortable, so I'll probably request that.
Separate utilities are great, I'm favouring properties that offer that, unfortunately this place does not.
Not sure how it works in Canada, but in the US you can just call the utility company(s) and ask for the average heat/water/electric bill for the past year.
A previous lease would be good however, keep in mind it may not be market rent. Also if you including utilities you can charge a premium to include them in the rent!
Not sure how it works in Canada, but in the US you can just call the utility company(s) and ask for the average heat/water/electric bill for the past year.
That sounds too good to be true in Canada - but I'll try when they open on Monday! Thanks for the suggestion.
Not sure how it works in Canada, but in the US you can just call the utility company(s) and ask for the average heat/water/electric bill for the past year.
That sounds too good to be true in Canada - but I'll try when they open on Monday! Thanks for the suggestion.
Kellan:
The electric and gas utilities will typically tell you the average billing for a unit (or all units in a building) as it is not personally identifiable. We have encountered some municipalities which will not disclose water and sewer billing (even on an annual average).
The seller ought to have some kind of proof of payment and bills if they kept any sort of records of their business. I have requested these multiple times even before offering and most people hand them right over.
Good to know. I requested a photo of their London Hydro and Union Gas bills, and any sort of documentation showing proof of income, so hopefully I have no trouble getting those. Making a decision without hard numbers is impossible.
Yep, I'll be there tomorrow. That'd be great to discuss it, I'd be interested in hearing people's thoughts.