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Updated about 4 years ago on . Most recent reply
![Alexander Tesfamicael's profile image](https://bpimg.biggerpockets.com/no_overlay/uploads/social_user/user_avatar/1782274/1701218740-avatar-alexandert92.jpg?twic=v1/output=image/crop=2292x2292@0x14/cover=128x128&v=2)
Houston MF - expenses
Hi BP community -
I'm looking to purchase a triplex or fourplex in the Houston area and would love to get feedback on the expenses that I'm estimating (too high, too low, any that I'm missing, etc.). Thank you in advance!
Expenses:
1. Property Taxes - 2.89% of home value
2. Homeowner's insurance - 1.3% of home value
3. Ongoing repairs - 12-15% of rental income, based on how recent major CapEx items have been replaced
4. Flood insurance (if applicable) - $592/year
5. Vacancy - 8% of rental income
6. HOA Fees (if applicable)
7. Property Management Fee - 7-10%
Most Popular Reply
![Lee Hampton's profile image](https://bpimg.biggerpockets.com/no_overlay/uploads/social_user/user_avatar/1932767/1625165051-avatar-leeh125.jpg?twic=v1/output=image/crop=2659x2659@0x424/cover=128x128&v=2)
Your expense #’s are in the right ballpark, more importantly, you have the right components from which to analyze an actual property. Expense #’s obviously will vary depending on the property. However, the demand for small (3-4 unit) multifamily of DECENT QUALITY far exceeds supply. Unless you have access to off-market deals, please exercise patience and prudence. Personally, I have better success in finding workable vacant lots and building from scratch. Admittedly, this is not for everyone. The added benefits for me are; 1) I am able to structure/replatt things in a way that gives me future flexibility to be able to sell the units individually or as a whole. 2) I can handpick an "opportunity zone" neighborhood as opposed to choosing between limited selections. Below is an example of a convert-able triplex that i am building for my personal portfolio.
![](https://assets0.biggerpockets.com/uploads/uploaded_images/normal_1608489267-Rendering_3013_Wilmington.jpg)