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Updated almost 8 years ago,

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6
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Joel Poualeu
  • Minneapolis, MN
0
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6
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How to Value Extra Rooms During Analysis

Joel Poualeu
  • Minneapolis, MN
Posted

How do you value an extra feature in a house/appt, be it a room or Gararge (space or type)?

I am new at analyzing properties for purchase and hold. Sorry if this question has been asked before and I missed it. Say you have a property, a duplex  with 2bed/1bath in each unit and it goes for 250K. The second property is also a duplex with 3bed/1bath and 2bed/1bath and goes for 275K. Let's assume these are in comparable neighborhoods, and all other features are quite similar. The 2nd unit  obviously has a higher rent and a higher cash flow.  How do evaluate the two units to determine if the difference in cash flow between these unit is worth the 25K difference in their purchase price? 

Thank you

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