Updated about 4 years ago on . Most recent reply
Need Help Analyzing a Property
Hi, so I found a off market property that I need help analyzing. I think I have given it too much thought and have mixed feelings about it. It’s basically 3 properties that contains 3 duplexes each for a total of 9 duplexes. I was given an initial maintenance figure and I feel like it should not be as high as the number they gave me. The amount I was told equals 26% of gross income and that’s only maintenance. The units were built in 1998 and 6 out of the 9 are all brick. I feel like this is a management issue or a few bad tenants. I’ve ran reports with their numbers and mine and it doesn’t work with their numbers. Would y’all walk away from this property or go off what you believe it could/should be? They may be trying to maximize their tax deductions. I hope these links to the reports work. (I haven’t tried yet to talk them down on price) From what I have seen there should be at least 25% equity in the property at their asking price.
https://www.biggerpockets.com/...
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Have you had a chance to visit the property yourself? I'd recommend talking to the current management company and seeing if they will give you a breakdown of the maintenance and dig into that report. I trust my management company but I always approve anything over $100 before they spend my money on it. It is possible that the current owner allows them a large budget that you may not necessarily do when you own it.
Also, I'd try to get this on a longer term to make the cashflow more attractive.