Income Property Analysis for Wholesale Deals

[Jessica Swingle]

Of course, the 70% - repairs - fee rule applies for analyzing potential rehab and resale deals....

However, I'm curious to know what calculations other wholesalers are using when determining income property MAO? (for SFH).

Some investors I know use 80% instead of 70% while others say they look at cash flow and base their offer on whether or not it cash flows a minimum number (say, $200) assuming, for example, 20% down, 5% interest.

thoughts?

Jessica

[Savannah Leigh]

I do it this way
total income
-30% maint/vacancy (also covers manager's first-month-rent fee)
-10% management
- all landlord hard costs
- 100/mo/unit profit (depends on number of units)
_________
balance tells me how much mortgage payment

this entered into mortgagecalculator.org at 6% 20 yrs.

this tells me property value.

- 5 or 10k wholesale fee
- some discount for end buyer equity

_______
max offer to seller

I have right now almost 20 units under contract this way