Is this a deal? Learning multi-family
Hey Guys! Noob here.
Long story short, I have a friend who is a real estate agent and through the MLS made a rule to send me 16+ units, seller will carry multifamily/apartments every monday. I don't believe this is a deal but I think this will be a good exercise in learning what to look for as although I do wholesaling my main goal is to buy and hold multi-family properties. Gotta start learning this!
Anyway it is a mobile park here in Arizona. Here are the details. Also do not hesitate to comment/criticize. I NEED to know, fully understand this stuff. Let me know anything and everything.
This information is direct from the MLS.
25 units
Zoning: C- 2
| Adjusted Gross Inc: | $133,912 |
| Other Income: | $25,400 |
| Operating Exp: | $59,547.78 |
| Net Operating Income: | $79,870 |
| Owner Association: | No |
| % Vacancy Allowance: | 0.05 |
| Annual Elec Exp: | $1 |
| Annual Gas Exp: | $1 |
| Annual Ins Exp: | $1 |
| Annual Land Lse Exp: | $1 |
| Annual Landscape Exp: | $1 |
| Annual Legal & Acctg: | $1 |
| Annual Maint Exp: | $1 |
| Annual Mgmt Exp: | $1 |
| Annual Other Expense: | $54,170 |
| Annual Ownr Asoc Fee: | $1 |
| Annual PAD Fee: | $1 |
| Annual Rplcmnt Rsrvs: | $1 |
| Annual Trash Exp: | $1 |
| Annual Wtr/Swr Exp: | $1 |
Tax Year: 2016
Taxes: $5,364.78
Ownership: Fee Simple
Range: 2E
Section: 8
Equity: $875,000 (free and clear)
Monthly Payments: 1
Assessment Bal Yrs: 0
Assessment Balance: $0
Cap Rate: 9.13
Down Payment: $1
Down Payment %: 1
New Financing: Seller May Carry
Reports/Disclosures: None
Value is $849,777, NOI $79,870 Cap rate 9.13. I know that you can get cap rate by dividing the value by the NOI so I did that and got 10.63950169024665---10.6. So I feel the numbers are off or maybe I have no idea what I am talking about (likely case).
I currently do not know the physical occupancy or the economic occupancy of the property. Please let me know what other information I need to gather to determine if this is a good deal or not. If anything, as stated above, this is learning experience for me and I need to know this like the back of my hand.
I appreciate all feedback and thank you!