Evaluating Multi-Family Property Values

[Chris Jordon]

Hey BP,

After much fear and hesitation I'm finally taking the big step and purchasing my first investment property! I've decided to go small multi-family (2 to 4 unit) and I've began looking at properties in Nashville, TN and surrounding areas in both Rutherford and Davidson County. While utilizing sites like Trulia and Zillow, I haven't stumbled across many properties worth getting too excited about but I did happen to find one that I liked. After doing some research in my local tax assessor's records, I was surprised to see you can access a great deal of information from their database. A couple of those bits were the city's appraisal and assessed values which leads me to my first question. How thorough and therefore accurate are the appraisal values conducted by the city? Secondly, understanding that cash flow typically plays a significant role in multi-family and commercial property, how does one go about determining if a property's asking price is fair/reasonable? Thanks in advance for any members who take the time to read and shed some insight!