Am I wasting time sifting through the MLS?

[Scott Rosslow]

I am in the West Palm Beach area. I have been more focused this year with trying to get the first property under my belt. I analyze properties pretty regularly (my focus is on 2-4 unit multifamily). Every listing is quoting a 8-10 cap and when I put any expenses to it it quickly goes to a negative cashflow. After putting in all the numbers i run goal seek of a $100 a month cash flow (iterate to get lower taxes with the county tax appraiser) and it shows that my offer should be about $17k on properties listed for $400k. It seems ridiculous.

My expenses usually look like this:

• Taxes - tax appraiser calc at sale price
• Insurance - guestimation of my house and fiance's condo
• Mortgage (+mip) - 1.15% (of purchase price - down payment)/12
• Rental Eff - 11/12 * monthly income
• HOA -
• Utilities - (check for seperate meters in listing or not ~150-200 per unit)
• Lawn - 100-150ish
• CapX - roof sq ft times $6.00 (difficulty multiplier) / 30 years / 12 month ; # water heaters ; # HVAC ; # wall shakers ; Septic Tank pump out per 10 year
• Property management - 1/12 of monthly income
• Other - usually left blank

My Income is usually whats listed. Sometime I look via trulia for "comps." problem is the MLS program the photos rarely show up. Also most multifamilies never show interior pictures on listing.

Should I keep on trucking? Should I try a mail campaign? Should I offer 17k on a 400k listing (My agents I have talked too don't seem to get what I want to do, seem kind of un-responsive to me)? Are my expenses way off? Try a new market? stockpile money for the next dip (i want the experience more than staying out of the game waiting for a better deal)?

[John Thedford]

you are doing something wrong if your analysis comes to the conclusion that you should offer 17000 on a $400,000 property