[Calc Review] Help me analyze this deal

7 Replies

@Raza Dhanji - it would be nice to see a slightly higher cap rate, however this isn't a bad deal. One concern is the taxes. I can't speak for Lake Mary, however in S.FL taxes for non-homestead is close to 2% of purchase price. So your monthly tax will be closer to $475. Verify that. 

 @Tchaka Owen :

Not being too experienced or familiar with multi unit and cap rate would you kindly explain how or what I need to do to get the cap rate higher? Thanks for the tip on taxes I will definitely verify that.

 

Originally posted by @Raza Dhanji :
 @Tchaka Owen:

Not being too experienced or familiar with multi unit and cap rate would you kindly explain how or what I need to do to get the cap rate higher? Thanks for the tip on taxes I will definitely verify that.

 

You MUST learn how to calculate cap rate, that's a basic requirement (hint: it's not difficult).

There are some expenses that you cannot affect (eg, taxes) and others you can. The 2 areas that I'd focus on are rents and purchase price. Are the rents maxed? Is there anything you can do to increase them? Can you get a lower purchase price?  

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