Skip to content
×
Try PRO Free Today!
BiggerPockets Pro offers you a comprehensive suite of tools and resources
Market and Deal Finder Tools
Deal Analysis Calculators
Property Management Software
Exclusive discounts to Home Depot, RentRedi, and more
$0
7 days free
$828/yr or $69/mo when billed monthly.
$390/yr or $32.5/mo when billed annually.
7 days free. Cancel anytime.
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
New Member Introductions
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated about 13 years ago on . Most recent reply

User Stats

7
Posts
0
Votes
Matt Nelson
  • Real Estate Investor
  • houston, tx
0
Votes |
7
Posts

New member from Houston, TX with a question

Matt Nelson
  • Real Estate Investor
  • houston, tx
Posted

Hello, everyone. I am a pretty new to the site although i have read tons of information on here. I was wondering how most people analyze a deal...

I have gathered from reading thru BP that for SFH expenses used for cash flow calculations are as follows:

Principal
Interest
taxes
insurance
vacancy
maintenance

Now Local investment clubs rant and rave about only using the following:
Principal
Interest
taxes
insurance

If one analyzes a deal using the latter criteria the cash flow is much MUCH better usually about 25% CoC on most deals even into the 40% CoC or more depending on your financing situation.

What is everyone's opinion on this? I am competing with investors making offers on the same house but using a much different model which allows them to have a high offering price and beat me out of a deal.

Most Popular Reply

User Stats

1,611
Posts
839
Votes
Rob Gillespie
  • Specialist
  • Cleveland, OH
839
Votes |
1,611
Posts
Rob Gillespie
  • Specialist
  • Cleveland, OH
Replied

Relax Matt! Don't get bogged down with formulas. If you need a calculator to figure the deal, it is too lean! Just buy stuff so freakin great you can't go wrong.

I just grabbed a house for 5k. It appraised at 30k as is and needs 20k to make it worth 75-80k. I will have it sold for 15k within a week or so. No formula there, just huge margins.

Good luck, just my 2 cents. :mrgreen:

Loading replies...