All Forum Posts by: Amy Ranae

@Account Closed I think you're right, this is what I need to do. I've pulled tax records and as a licensed broker, I have access to most of the info that is public except rents and expense. Do you have a spreadsheet or template you use to analyze things?  Honestly, I think Ihave more questions for you but I'm not sure what to ask.

@Dave Younts I think what you are spelling out here is EXACTLY the formula I'm looking for. So, I'm terrible with math, would you mind breaking this down for me a tiny bit more? Like, show your work style, from elementary school? 

ie. where did you get the 59400 number, and go from there? 

Thanks a TON!

@Andrew Johnson, as it happens I'm a licensed real estate broker in my area. I have had some conversations with commercial agents about this process, but they offer a very different perspective, coming from a listing agent angle. Maybe at the end of the day, I need to pick up the phone to start figuring these deals out, but as I mentioned before, I've heard Grant Cardone work the deals backwards if he knows only one number and I'm looking for the formula somewhere but can't find it. 

Thanks! 

Thanks @Carl Dean!

I won't know cap rates until I start contacting sellers, which I'll be ready to do in the next few weeks I think. 

@Jonathan Twombly my conversation with a commercial lender at my preferred bank had monthly debt service w/ the above numbers around 2200 if I remember correctly (could be wrong!) which makes finding 10+ units that rent around 900 (under market) seem like a good purchase to me. 

The way I'm looking at it, 3 units pay the debt, maybe 3 more pay the expenses, and the rest is profit. Then I update the units and raise the rents as they come due and I'm in business. (in my mind =)))

Am I on the right track at least? I have a townhouse I BRRR'd last year (although I'm going to sell rather than refinance and pull out 70k on a 1031) for most of the dp. I'm a licensed broker so I'll just make up the rest of the 100k by selling some houses.

@Jonathan Twombly ok, it may very well be 25%. I'm budgeting 100k down on a 500k purchase.

@Jonathan Twombly This would be a big expense compared to what other type of financing? 

Yes, I'm hoping to essentially flip the units and up the rents so I should have room for improving cashflow. I'm shopping off market so hoping to find something at a deal price =) 

@Carl Dean, thanks for your help. In this situation, I don't have the other info so I'm trying to evaluate it BEFORE reaching out to the owners to find out what their expenses are.

Yes, all of these buildings have significant room for updating and rent increases, but I want to make sure they cashflow when I purchase them so I can fund the improvements at the leases expire. 

To clarify my question: is there a way to estimate what the expenses would be if you know the income? 

Hello BP Friends!

I'm looking for a 10-30 unit apartment building in my market place by pulling the tax records of buildings with this many units, then looking them up and doing some research before finding the owner and reaching out for a discussion. 

Here's my question, if I know what they are getting in rent, I know I should be able to figure out what the price should be. Grant Cardone talks about this all the time. However, since I haven't done it really yet I'm looking for your help.

So can we practice together? 

Let's say it's a 10 unit building of 2br 1ba apartments that currently gets $900/mo for a unit. Without knowing operating expenses, how would you establish a guesstimated value? 

Assuming 9k/mo income = 108k/ year minus 10% (vacancy? Cap ex? what rate would you use?)  now we are at around 97k/ year income. 

Where do I go from here? 

I'm planning a 20% down commercial loan, I've got a lender. But want to start practicing on some deals in my spare time. 

Thanks! 

Yep, I pretty much but the end on this plan after calling 12 HOA's and getting the 30 day min thing....would be different if I already owned it. So now I'm just going to buy the whole building =) Shopping for apts =) Thanks @j.martin!