**JUST BOUGHT A 10 UNIT APARTMENT BUILDING NOW WHAT???

[Mil Sanghvi]

Hi BP,

I JUST BOUGHT A 10 UNIT APARTMENT BUILDING!! NOW WHAT DO I DO TO TRANSITION??

I am closing on my biggest property yet (10 units) on October 15th. I am uncertain as to the exact steps to follow when you transition. My LLC will own the property and another of my LLC will manage the property. It cash flows well with the numbers below. Expenses are verified. 6 of 10 units are on section 8 with long term tenants and is 100% occupied. I only accept direct deposit, pay online or pay through pay pal. No mailed check or pick ups.

Purchase price 300k and owner is giving 20k towards upgrades/repairs etc  Plan is to install surveillance cameras, lights, paint doors and shutters, 2 water heaters and new signage and minor fixes etc. Pocket the rest ;) :P

What are the steps to follow to transition into new management.

What should I expect from the tenants?

Are my numbers realistic?

Step by step guide would be very helpful.

What do you wish you would have known when you were in my place?

Property Management software recommendations? I'll have 15 units total. 

.................................................Monthly               Annual             % of Income

Gross Income                           5250                   63000               100

Vacancy 5%                             262.50                3150                  5

Gross Scheduled Income         4987.50              59850                95

Expenses

Property Taxes                          275                     3300                  5  

Property Insurance                   275                     3300                  5

Electricity                                  150                     1800                  2.85

Water                                        150                     1800                  2.85

Waste Management                 100                      1200                 1.9

Lawn Care                                250                      3000                 4.76

Repairs/Maintenance               250                      3000                 4.76

Property Software                    200                      2400                 3.8

Property Management             262.50                 3150                 5

Total Expenses                       1862.50              22350               35.5%

NOI                                          3125                    37500               64.5%

Debt Service                          1466                    17596               27.9%

Cash Flow Before Taxes       1659                    19904               31.59%

Debt Service Ratio    2.13,        Cash on Cash return 26.5%    

At 10% cap the property is worth 375k

Thank you in advance.