Cash Flow on Small Multifamily Deals

4 Replies | Oklahoma City, Oklahoma

I'm curious, what cash flows per unit are you seeing right now in OKC on financed small multifamily (2-4 units) deals? I know financing will vary, but I'm setting goals while reading Think and Grow Rich so I'm trying to get an idea of what is typical in the area.

The last deal I reviewed was a pretty solid cap, but only came to about $60/unit. These were single bedroom units. I did pad the numbers with higher than likley expenses because some of the utilities were paid by owner and I wanted to look at a tough month rather than the best month when evaluating. 

@Daniel Hughes

I listed a duplex for 145k and the person buying it is financing on a 30 year conventional mortgage. It's rented out for $1530/month so it should be cash flowing about $250/door once it closes. That's a better deal than most of the multifamily properties that I've been seeing lately, but it's still possible and this one went up on the MLS.

Originally posted by @Cassi Justiz :

@Daniel Hughes

I listed a duplex for 145k and the person buying it is financing on a 30 year conventional mortgage. It's rented out for $1530/month so it should be cash flowing about $250/door once it closes. That's a better deal than most of the multifamily properties that I've been seeing lately, but it's still possible and this one went up on the MLS.

Saw that one. Went under pretty quickly, so nice job there. Not sure how you're getting $500 cashflow, tho. I'm showing about $900 in PITI (20% down). with about 20% of gross rents for expenses (more if hiring a PM), you're looking at about $300 total (still a pretty decent deal). The ad did mention upside in rent after some reno, but that's additional cash in the deal :)

@Victor S. Thanks! It's going to be a good rental for someone! The $500 would be gross cashflow, not net. I don't factor in reserves when I ballpark cashflow numbers like this since everyone does something different for reserves. I comped the rents out about $50-100 per side under market rent right now, so whenever there is a turn-over it should be pretty easily rented out for least $800+ per side. Right now it's at $1530/month but it could easily hit $1600 with a minimal paint and flooring style make-ready.