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Updated over 7 years ago,

User Stats

110
Posts
50
Votes
Amit G.
  • Investor
  • Mechanicsburg, PA
50
Votes |
110
Posts

5 unit multifamily - validate numbers

Amit G.
  • Investor
  • Mechanicsburg, PA
Posted

Hello BP'ers, I am excited to share that I have my first multi family under contract. Its a run down mfu that has been vacant for past year or so.  It is in a great location but needs a total rehab.  Please review the numbers below and let me know what you think!

Acquisition: $95000
Rehab: $80000
ARV: $220000 - $250000 (comps provided by realtor)
Likely gross rents: $3000/month + $25 for coinop
Landlord fixed expenses: $750/month (sewer, common electricity, Insurance and lawn care/ snow removal)
Vacancy: 8% (not sure about how to calculate this!)
Repair: 5%
CapEx: 10%
PM: 10% (Is it reasonable or should negotiate for less?)

I am going with cap rate of 8% (not sure how to find it for the area).  

Electric is already separate and I am also getting water meters separated so renters can pay for that along with gas and trash. 

Does it look like I have all the expenses covered? and what do you think of this deal?  

I am going with the philosophy of increasing rents and reducing the expenses to provide a value add to the property.  Is there anything else I can look at towards that goal?

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