How do people do their baseline analyzing of deals based on info on the MLS? The info I am seeing (Denver at least) is suspect at best, and I assume you wouldnt be privy to actual financials and leases until a contract is written...

Im green to personal REI and just not connecting the dots here.

Realtors have a tendency to always leave out a lot of information on their MLS listings. The smaller the building typically the less info they have.

Owners do not always keep very good records either.

What size asset are you looking into? 1-4 family? 5+?

You can generally get basic info from the listing broker

- are there written leases in place and are they month-to-month or term?
- is the income included on the listing (if any!) projected or actual?

Then do your own due diligence on area rents - search Craigslist, talk to other landlords, knock on neighbor's doors, and don't be afraid to ask tenants questions if they're home during your showing.

If you're new to REI, hit up some local landlords here on BP for some advice on maintenance costs. If you've walked the property you can get a good idea of what has been deferred, and what types of items you'll be responsible for.

If you do write a contract you can ask for all sorts of documentation, and use that to help you decide if you actually want to purchase the property or not.

OK.  You don't have to go all the way to Contract, but you will have to dig for the right info.  Just starting to get into the 'desktop underwriting' phase of educating myself on small multifamily in the context of Buy and Hold.

Thanks @Micki M.  

@Mitch H.  - you won't get actual leases until the property is under contract. Financials are generally stated in the listing if the agent knows what they are doing. There can be puffing if the agent uses "market" rents vs what the LL actually is collecting. Not supposed to do that but it happens. You can get a copy of schedule E for the property after you have it under contract. You should really know what the real answers are before you get the schedule E. You should know market rent and what typical expenses are and run your own numbers before offering. Looking at the financials should confirm you conclusions. They might bring up something you missed or they might miss something. If they miss something you can sometimes use that as a bargaining tool. Not so much in our current market. Initially you have to take the listing broker's word for expenses but you should also have a real good idea what they should be on a particular property as well.

Anything under 4 units is typically not valued using cap rates so the prices can be all over the place.

My baseline analysis goes like this. I figure out what kind of tenant I want to rent to and then I find the areas that those kinds of tenants are renting in and I learn those areas inside and out. I learn what market rents are for that area. I learn the bounds of that area. For example South of Colfax is often called Sloans Lake. Most tenants looking in Sloans Lake would not cross Colfax for a rental property unless they are priced out of Sloans Lake. Same goes for people purchasing investment property. You have to know that going in so when you see a property listed in Sloans Lake that turns out to have an address in 1000s you know the lower price reflects the location not a bargain. You also know that rents are a couple of hundred dollars a month lower per bedroom. You can make a quick determination of whether or not it's property that take more evaluation.

Meet with a mortgage broker and determine how much you can afford. Learn what offsets you get from the rental income and what you need for down payments. Typically all those things quickly narrow your search. Once you have area and price you start looking at property. Plan to spend a few months doing that. Don't be afraid to miss a deal. There will be others. Right now you need to learn. Once you learn then you can spot a deal.

Don't go for a home run. Get a solid base hit and then reload for the next one.

@Bill S. Denver is definitely a hyper localized market, sounds like your experience confirms that.  But yes, as you said, I am definitely just jumping into the deal analysis part.  I feel I have a good background professionally (analyst at institutional multifamily investing firm) to be getting into this kind of thing, but there are still many differences to be realized and ironed out.  

Depends on the size of the property you are looking for purchase but all things being equal, take 40% off of the gross rents for expenses and 50% if it is an older building or  more challenging (high turnover) area. This is not taking in account financing. 

In terms of financing, look at your cap rate/ROI and not your cash on cash return. When your mortgage is satisfied 15, 20, 30 years later, ROI will be the same as the day you purchased it. Not that exciting to only get a paid off building at 8% or 9% return.