holding cost formula

[Jason Huang]

How to calculate holding during rehab? what is the formula to holding cost in a rehab? 

[Kuba F.]

There is no formula as it depends on each specific situation, largely depending on your location and therefore taxes as well as financing.

I wrote a BP blog post a while back about these as well as purchase and sale costs here:

https://www.biggerpockets.com/blogs/8814/70530-fix...

Hope that helps.

Cheers!

[David Robertson]

Holding Costs are calculated by taking the monthly holding costs multiplied the number of months you plan on holding the property:

Total Holding Costs = Monthly Holding Costs x # of Months Held

Here are some typical holding costs:

1. Loan Payments- Monthly interest payments if you are getting outside funding for the project
2. Property Taxes - Property taxes will vary depending on your local property tax rates. To find the property tax amount for a property you can search your local county assessor's website.
3. Property Insurance ($100 to $150/month) - You will need to get Property Insurance to cover your property from loss and liabilities.
4. Utilities ($200 to $350/month) - For utilities, think about how much you pay for your own personal residence in utilities. Generally, in my area you will have around $200 to $350/month in utilities depending on the season.
5. Maintenance ($50 to $100/month) - Maintenance costs include any kind of on-going property maintenance such as lawn mowing or snow removal.
6. HOA Dues - If your property has a Home Owner's Association, you will likely have Annual HOA dues for the property. Generally, you can find HOA information on the property listing or the neighborhood's website.

[Bridget Poston]

Jason thank you for posting this question because I was wondering the same thing! David, your response is very thorough and pretty much what i was looking for to get at least an idea of what holding costs are. Thank you for the info!