All Forum Posts by: Account Closed

thanks for the replies !! 

 Tim, $60 a month of electricity is what the landlord pays (4 outside lights that come on at night and the electricity in the laundry room for a washer & dryer).  all units have their own gas/elec meters and they do pay their own utilities. 

In my request for advice, I realize now I didn't state my question very clearly.  The current income on the building is $4600 total.  (Each unit varies a bit, but totals $4600).  

If I include 3% vacancy, 5% maint/repairs, and 3% Cap Exp... My monthly cash flow could be as low as $100 per unit.  

If $100 per unit cash flow isn't such a good deal (even when funding vac, maint/repairs & cap ex, what is the per unit/per month $ I should be looking for?  I won't be needing to 'live' off the cash flow from this building and I have zero experience with what depreciation will do for us...??

I understand cost paid per unit can vary greatly by the location in which you are buying.  I live near Los Angeles and have an opportunity to buy a 4-plex building that I would REALLY appreciate feed back on from seasoned investors.. is this a 'good deal' or not?  I have heard Brandon Turner say he wants to hit $100 per unit in monthly cash flow, for property in/around Los Angeles, is that a good target?

Here are the facts that I'm needing advice on...

4- 2bed/1 bath units.   (no immediate required repairs, all units rented).

$656,000

owner pays:

electricity - $60 per month

Sewage/water - $320 per month

Insurance - $125 per month

Taxes - $500 per month

Garbage - $60 per month

P & I - $2570

At these variables, (not including assumptions such as vacancy rate, capital expenses & maintenance/repairs) that is 8.23% cash on cash return with $924. monthly cash flow.  I don't know how to consider 'depreciation' ... 

Any thoughts from anyone on this would be a good starter or not?

THANK YOU!