Where to find investment calculator info?

3 Replies

Hello BP!

I'm trying to figure out how to find information for the fields of expenses in an investment calculator. Is it a matter of contacting the appropriate experts and getting a quote for each specific property I'm considering? Or are there rules of thumb? Can I ask for this information from the seller?

Here are the fields I'd like to fill in for my analysis; the only ones I can look up myself are Taxes and Ground Rent (for Baltimore City).

Property Management
Accounting
Legal
Repairs
Maintenance
Insurance
Janitorial
Supplies
Prop/op taxes
Ground Rent

Thanks as always for your advice!

Alison

Might have just answered my own question --- or rather, found @J Scott 's excellent article that answered it:

"Expenses: Similar to income, details about expenses should come directly from the seller (last warning not to trust pro-forma data!) or the property management company currently running the property. This is another place where a building inspector could help warn you about any major repairs that may be coming due in the near future (new roof, new heating/AC, etc)" http://www.biggerpockets.com/renewsblog/2010/06/30/introduction-to-real-estate-analysis-investing/

@J Scott , should I just email the seller and ask for this info? Or should I ask my agent to reach out?

Thanks for the add'l detail!

Alison

Originally posted by @Alison Michel :

J Scott, should I just email the seller and ask for this info? Or should I ask my agent to reach out?


Talk to your agent about whether it's okay for you to contact the seller directly. Different agents/sellers will feel differently about this, and it's possible that there are circumstances that will dictate whether the agents want the buyer and seller communicating directly or not.

As a buyer, I like to speak directly with the seller, but it's protocol to work through the agents until they agree it's okay...

Keep in mind seller may not give you accurate information. Just as importantly they may not know the information. Some landlords keep very sloppy records.

Expenses can vary quite a bit from year to year. One big repair or change in vacancy can move the needle quite a bit in one year. So even if you get accurate numbers from the seller that does not mean they will be your numbers.

The 50% rule says expenses will typically average about 50% over time and over a large portfolio. But any given property on any given year can vary quite a bit from that amount.

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