My first deal. Need advice !!!

[Harpreet Singh]

Hello BP community,

I am working on my first real estate investment deal. This deal is to buy and hold single family home investments.I have an investor who is selling three single family homes, which are currently rented out. I am putting 20% down. Since this is my first deal, I am kinda nervous.

How do I analyze this deal?

Is there a due diligence check list I can follow?

Is there a spreadsheet to analyze rental properties?

Any tips on negotiations?

Any specific podcasts I should listen to?

Any specific Blog I should read?

Any tips or advice would help.

Thank you 

[Josh Justiniano]

Go to the files portion of BP and download an excel model to analyze. 

Make sure to account for vacancies. Find out vacancy rate in the area, and add some cushion because of the oil crash. I bet vacancies are likely to rise in Bakersfield soon.

Figure out the remaining economic life of the big ticket items (Roof, A/C, Etc..) find out reserves needed every month.

Apply some cap rate to find your max offer, make sure your mortgage constant is less than cap rate.

Get original lease agreements.

Get tenant estoppels.

Check bank records or Schedule E's if possible to verify income.

Get copies of the last few rent checks.

Check permits if it's an older house in Bakersfield. Ran into a few issues on an older property with a re-roof b/c owner didn't get final inspection. Always good to check.

Good luck.