multi famiy underwriting techniques

[Robby Sanchez]

Hey everyone, me again, I am practicing underwriting MF deals and came up with a few questions (I am sure there will be more). 

-when figuring rules of thumb regarding payroll cost per employee/position or things like repairs and maintenance cost, contract services, etc. per door in a specific market do yall suggest contacting a property manager to find out these numbers or actually using google or job listings etc. i thought about using chat GPT as well. any thoughts on this? I realize that these numbers change depending on size of the property, position type etc. as well as every market is different and fluctuates. just trying to get some general advice on this. TIA 

[Robby Sanchez]

Quote from @Charles Seaman:

@Robby Sanchez Calling property managers who know the market(s) that you're looking in will produce the best results.  Keep in mind that a rule of thumb is simply a rule of thumb.  It doesn't mean that every property will fit that rule of thumb.  Too many people get caught up in this thought when they underwrite deals.  Also make sure that you're using 
"per unit" numbers for your rules of thumb because this is much more accurate than simply looking at the expenses as a percentage of the property's income.

 thanks charles, i realize that the rule of the thumbs are not a 1 size fits all. I agree with the per unit approach as well. Doing it that way also allows you to get a general idea of how much income is needed to at least be close to breaking even. obviously being close to the break even line is not where anyone wants to be but it is interesting and useful metric.