Market Rents vs. Atual Rents & Working up the Offer
Good Afternoon Investors,
I am currently making 25 offers a week looking for my first small multi-family deal (2-4 units) in the Philadelphia area. My question centers around deal analysis and utilizing rents as part of the equation. When offering on leased properties, my real estate agent is telling me to use market rents, however, it would seem to make more sense to use actual rents when calculating an offer. Many times average market rents are higher than the rents the current landlord is getting. Is it best practice to use market rents or to use the actual rent the property is generating when constructing an offer? Thanks in advance.
Steve