I'm not 100% sure for Davis, but I'm guessing it's a pretty hot market out there right now as well. The reality of the numbers is what matters. If you have one unit filled at $2,800 and your using that to pro forma the other units when the normal rents for something similar are $2,500, then yeah the $2,800 probably won't fly. But if you have four or five units rented at $2,800 when market rents are closer to $2,500 then its easier to pro forma that last one at $2,800. We rented three units leaving the best one for last to make the $2,800 an easy sell and we had three or four emails coming in each day to see the unit. If all the units were empty we probably would have been using $2,600-$2,700 as our pro forma rents and we may not have set the record for the highest sale in that area. In the bay area not having a solid I & E doesn't really matter, of course it helps but it's not going to keep you on the market for an extended period of time. If you are on the market too long you did your original numbers wrong and/or your anticipated arv was wrong. We bought this with an I & E scribbled on binder paper and sold it with all pro forma expenses and income, tenants weren't even in for a month. We bought another 4-plex with the I & E scribbled on something a little more professional but still essentially it was garbage. I guess the point is if the area is solid, which Davis is, you shouldn't take too big of hit, if any, as long as your being realistic with no solid financials. Having them rented will only help.
Is this six town homes in a complex or a 6 unit building? If it's six town homes in a complex that might be your bigger battle.
