All I have is NOI and total expenses

[Antoine Brown]

Hello BP partners, Im looking to buy a 4 unit family home for 225k. I want to analyze the numbers before I contact a realtor. With just having the NOI and the total expenses what will that help me find out about the property? I understand the NOI doesn't include the taxes, insurance, vacancy, cap ex. ​I will be putting down 20%. Those numbers are from the realtor site. NOI -$22700 Total expenses-$4956 Taxes $3456

[Thomas Franklin]

Antoine Brown From the Realtor, you should request the following information: the Trailing 24 (the last 24 months of Actual Expenses as well as the last 24 months of Rent Rolls). DO NOT accept Pro Forma Data. You should also contact the Property's Management Company, to gain insight into whether there is Deferred Maintenance, the actual rents being paid, how the property has been managed in general as well as the age of the property, the age of the roof, the age of the major electrical system, the age of the major plumbing system, and other applicable major systems. With this information, you should call at least three Insurance Companies, to get quotes.

When you crunch your numbers, you should include 10% of the Gross Monthly Income, as an expense, for Capital Expenditures. In addition, you should include 10% of the Gross Monthly Income, as an expense, for Property Management.

Finally, whatever numbers you receive, from the Realtor, you should assume they are erroneous as the majority of Sellers fudge the numbers, to have the property appear it is performing better than it actually is.