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Updated over 8 years ago on . Most recent reply

User Stats

8
Posts
3
Votes
Patricia J.
  • Los Angeles, CA
3
Votes |
8
Posts

What do I do if seller is clueless?

Patricia J.
  • Los Angeles, CA
Posted

Hi everyone,

I am a new investor currently finding and analyzing deals in Los Angeles. I came upon a 4 plex which is listed at 1 mil. I got the rent roll and past 6 months expense report by the property management company. However, 

1. my calculated annual expense is lower than the listing agent's estimation. I think the agent simply took market rent, applied them to all units, and used one of the R&M rules to come up with his number

2. property manager listed no rent income for 6 months straight and suddenly for the very last month on paper there was an income of about 2800 dollars. this made me doubt if the entire income and expense reporting was accurate

3. owner did not provide tax or insurance numbers - the listing agent estimated them...I also heard from the selling agent that one of the bigger units will be vacant from next month, due to eviction of tenants from rent delinquencies 

The owner is out of state and seems clueless on the operations of this building. I am more confident in analyzing properties with good records of income and expenses, but what do I do when the owner seems clueless and all the numbers are just flying everywhere? 

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