Deal Analysis for Multi Home Situation
Good morning BP Brothers and Sisters,
I may be pulling the trigger on a packaged deal for 9 units (4 Duplex and 1 SFR) and 2 lots of land however wanted to get your take on how to analyze the deal. I'm used to the 4 square method and or the BP Calculators on here however can they be used in calculating multiple homes in 1 deal? Should I treat the deal as 1 mortgage as in reality it would be? My thoughts are I would have 1 PM cover all, still account for Cap-Ex, Expenses, Vacancies, etc. Am I approaching this the correct way or should I be separating these out as each home would get it's own Cap-Ex, Expenses, and Vacancies? Thank you kindly guys and looking forward to your responses!
Most Popular Reply
Hi @Rick Turman ,
I'm in agreement with @Jay Helms , if the properties have like mechanicals, exterior, ... Then treat them as the same.
Sometimes in bundled packages such as this, there may be value to unlock in buying the group and then selling the units individually. If the units will ever be seperated from each other, make sure to log your expenses/repairs to each unit so that the future buyers can confidently know the capital improvements. E.g. "Duplex A" has the newer furnace but "Duplex B" has one that's a few years old.