I am analyzing this property, after talking with the owner and the agent I feel this property fits my company's portfolio perfect but I'm using DealCheck App and never questioned the apps reports until now . I can use some help :)
$489,000 Previous Price: $485,000
# Units:2GSI:$48,000SqFt:2191Year Built:1987Ac/LSqFt:5,663/0.13
Facts & Features
Gross Sched. Inc.$48,000
Net Oper. Inc.$0
RoomsJack & Jill, Main Floor Bedroom, Main Floor Master Bedroom, Master Bathroom, Master Bedroom, Master Suite
Appliances6 Burner Stove, Dishwasher, Gas Oven, Refrigerator, Water Heater
Interior FeaturesCeiling Fan(s), Recessed Lighting, Stone Counters
Lot FeaturesOn Golf Course
Security Features24 Hour Security, Gated Community, Gated with Guard
Units:1Beds:3Baths:2Garage:3Actual Rent:$0Total Rent:$0Pro Forma:$3,000Furnished:Unfurnished
Units:1Beds:1Baths:1Garage:0Actual Rent:$0Total Rent:$0Pro Forma:$1,000Furnished:Unfurnished
# Of Units With:
Special Listing ConditionsStandard
Association Fee FrequencyMonthly
Rent Control YNNo
50% OCCUPIED AT $1200 FOr STUDIO And THINKING $2995-3100
So what’s the question? Obviously you’re missing the expenses.
I never trust the pro forma numbers. Can you really get $4k per month in rent for these 2 units? Seems the unit that generate most rent is vacant (probably for a reason). You need to know the area and have good feel of the local rent.
Given this is duplex, you should be able to run comps to see market value. We can not say if this is good deal or not without knowing all the expenses, such as insurance, property tax, etc. $495 HOA will eat into any profit, but it also depends what HOA would cover.
What is the monthly / yearly occupancy rental rate? Is it in good condition? What is the annual gross / net income?
The accuracy of DealCheck's cash flow projections will depend on you correctly estimating the potential rent and operating expenses of the properties you’re analyzing.
Looking at what you posted, it doesn't look like you have an itemized list of expenses, as well as vacancy estimates, which will make it very hard to calculate any sort of pro forma, like the others have mentioned.
@Anton Ivanov this is the details from the listing so if they didn’t place the info I assumed it wasn’t any too place there
@Edward Liu this is the details from the listing so if they didn’t place the info I assumed it wasn’t any too place there
@Jordan Autrey Well, of course you have bandies and expenses......taxes, insurance, repairs, capex, etc. Like for any formula.....garbage in, garbage out.
You need to contact the listing agent and ask for a detailed info packet, including the current rent roll, operating statements for 2 years, cap ex schedule or past work done, pictures - if they have any, etc.
Well all of the expenses listed are $0, so I would say it is too good to be true!
You need to get your hands on the historical expenses in order to determine who much the property will cost to operate.