Running some numbers 🧐

[Alessandro Pascucci]

♦️This is what I do to estimate my entry point - VALUE ASSESSMENT - “We make money when we buy not when we sell..... right?”

1) I look the average price in the area (similar properties - number of beds and baths) and general status of the property

2) Calculate the 70% of the average price in the area and deduct some rehab cost that I think the property need.

♦️This is what I do to estimate if the property will generate cash flow - INCOME

1) I look at the average rent in the area; (I need to figure out how to research for Vacancy rate in an area, any suggestion? ) NOTE: I try to search for offices - colleges nearby - subway.

2) I measure 50% of the average rent for Expenses (small repairs, big repairs, cap-ex, property taxes, HOA (if applicable); property management; vacancy ... you suggest others?)

3) I deduct my income taxes from the 50% money left after expenses and deduct the mortgage payment.

4) I have the “monthly post taxes cash flow”

5) I would like to have anything from 7% and more as “cash-on-cash” per year.

What do you think?

Any suggestion or correction ?