Skip to content
×
PRO
Pro Members Get Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
$0
TODAY
$69.00/month when billed monthly.
$32.50/month when billed annually.
7 day free trial. 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.
Real Estate Deal Analysis & Advice
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 over 7 years ago,

User Stats

180
Posts
93
Votes
Aaron Linden
  • South Bend, IN
93
Votes |
180
Posts

Advice Analyzing Small Multifamily

Aaron Linden
  • South Bend, IN
Posted

Hey BP,

I am analyzing my first multifamily property currently although I do own a few single family properties currently. This property is a 6 unit (1 - 3bd, 2ba; 4 - 1bd, 1ba; 1 studio) and is adjacent to a local college campus. It is a brick 1 story built in 1955 and the owner is asking 225k. I performed my analysis as follows.

The 1st column is what was sent as proforma, the 2nd is adjusted based on what I believe to be actuals after visiting (2 units vacant) and an expense added for the mowing and plowing. I also increased the taxes to what I would be paying when the property is reassessed at a new purchase price. The final column is representative of what I believe I could operate the property at. The total ROI and cashflow (~112/month/unit). Furthermore, if I look at this from a different perspective, we could assume I pay him a very generous cap rate (for South Bend) at 8% on the adjusted proforma and subtract the cost of rehab (50k) we would end up an offer which is highly unlikely to be accepted of ~110k.

I am looking for feedback on a couple things here.

  1. Which method would you use to analyze this property?
  2. What do you guys think of my expenses?
  3. What would you pay for this property?
  4. Am I just looking at this all wrong?

Thank you for helping a noob!

Aaron

Loading replies...