Diving into 15 unit complex from SFH rentals

[Melanie Siegel]

I’ve only ever owned a few newer single family home rentals in master planned communities that were low maintenance and easy to rent. I’ve now found a 15 unit complex in my neighborhood that I love. I’ve read enough posts and blogs to feel fairly familiar with acquiring a loan, and feel confident in managing the property. My question is, do I evaluate the deal the same way I would a single family home rental? What are some of the big differences? The unit generates 140,000/year in rental income, but is listed at 1.8 million. The unit is over 50 years old and I’m planning on having quite a bit more maintenance than I’m used to and having to do quite a bit of remodeling while i have vacancies, as there is good potential for increasing rents. Thanks for tips and advice!

[Dillon McGough]

Simple answer to this question is NO, there aren't many similarities between multifamily and single family calculations

Ask the broker for the last 12 months of profit and loss statements along with the current rent roll.  If you can acquire that and block out the property address, you can post on here and we can take a look at it for you. 

I suggest you get your hands on a calculator that will help you out with this.  I use the Jake and Gino calculator. It has a tutorial that walks you through exactly how to use it, which is foolproof. There are other calculators out there, but this is the only one I use. 

https://jakeandgino.mykajabi.com/store/zdt9X8o2

I'm not sure what market you're in, but you're looking at a 15 unit for 120k/door.  The rental income isn't the important number, it's the net operating income that you're looking for.

Come back and post the numbers here, I'd be happy to take a look as I'm sure others will too. 

Dillon McGough