"For sale' listings provide both current and proforma financial analyses. In a market with rent control, the proforma can be significantly different from current. When considering a building for purchase which numbers do you use?
I always go with current figures because that is what is I can know. Who knows when a tenant will move and I don't want the headache of buying out renters to get the unit to market.
Do the proforma figures warrant any serious consideration and when, or are they just a "come on" to attract buyers?
@Maria Teo most of the multis that hit the market in my area are severely under market rent. I typically run the numbers at where they will be after I purchase the building and stabilize it, bringing the rents up to current market value. Figure out what your end goal is, how much money it will take you to get it there and how much time it will take. I don’t want to lose money in the mean time but I am buying the property as an underutilized asset and executing my strategy to add value and raise rents.