Analyzing a MultiFamily Property to Househack in NJ

[Account Closed]

Hello -  I would like to ask investors in New Jersey (or anywhere) about expenses to consider when you are analyzing a multifamily property to househack- snow removal, lawn maintenance, etc.  I just want to make sure I am including every expenses to get an accurate cash flow number. Thank you!

[John Leavelle]

Hello @Account Closed

Here's a basic list you can use:

5 -10% Vacancy (depends on the area and property condition.

Operating Expenses 

10% Property Management (Rates vary.  Always include even if self managing) plus 1% for turnovers.

5% Credit Losses (Uncollected Rent and Skips)

5 - 10% Maintenance/Repair (depends on Age and Condition of property)

5% Taxes and Insurance (Varies)

5% Utilities paid by owner (Electric, Gas, Water, Sewer, Garbage)

5% Landscape Maintenance/Snow Removal 

5% Misc (HOA fees, Pest Control, Legal, Accounting, Advertising, etc.)

5 - 15% CapEx. Capitol Expense reserves (depends on Age and Condition of property)

Obviously these percentages are not hard and fast.  I always go in very conservative expecting 55% expenses  until proven otherwise.  This list will give you at lest something to whittle down.

Hope this helps.  Have any more questions just ask.  :)