Updated over 4 years ago on . Most recent reply
How to analyze a mass deal?
Hey everyone I'm new to BP and RE investing in general, working on trying to get my hands dirty in the crazy market of Boise Idaho. I've been looking off market for a while now trying to see what would come up, and recently there was a deal that I wanted to share with you guys and see what your thoughts were on it. This is more to help me learn because it is not something that I could afford but someone else could possibly benefit from it! Heres the info:
43 rental units in Canyon and Owyhee county $5,250,000. 15 houses/stand alone units, 3 triplexes, 2 fourplexes, 2 duplexes, 1 7-plex. Current monthly rents are $36,875. Some properties have room to build additional units. Year 2020 numbers Income $413,222.97. 2020 Expenses including property management $103,755.03. Current cap rate 6.42%. Gross rent multiplier of 142. Rents are only averaging out at $857.56 per unit so room for increases. With just a little bit of updating you could push the cap rate to 8%. Possible Terms with 1.5 to 2M down. All this in one of the hottest rental and real estate markets in the nation. Not interested in splitting up the properties. Serious inquires only.
Would I treat this analyzation as a "single property" by using the purchasing price and all other info as one combined piece of information? Or would it be different because of the different type of properties that are involved in this sort of investment? A few other things - average rent around here is 1000 at this point, this is not a current cash flow market, but rather an appreciation market from what I've seen for the most part. On average the properties would cost 122000 dollars a piece with an average rent increased to approximately 900. How would you go about analyzing this? I'm excited to hear your thoughts and learn from you guys!