Apartment Complex Deal

3 Replies

Is this deal within range of a reasonable offer? Has 95% Occupancy, 1950s building in so so part of town.

$415,000 Purchase Price

$80000 Rental income

$8000 management 10%

8000 Capex 10%

8000 Repairs 10%

4000 Vacancy 5%

$4237.62 Taxes

$18713.64 Loan payment

$2138 Insurance

$10000 utilities

$63,088 Expenses

$16,912 Income

$125,000 down/ $290,000 Loan

13.5% Cash and Cash

I don't know how many units this is, but a good rule of thumb for your expenses will be around 48-52% of the income. That number is before your mortgage payment and interest. That includes your management and the other items you included, so I don't believe you are far off that number, but I would also always keep vacancy, loss to lease, bad debt, etc. at 10% just to be safe. Especially at times like this. Either way it could very well be a good deal. Good luck!