All Forum Posts by: William Hucks

Well I just realized I wasn't accounting for property management costs! With that as a factor I am getting more realistic returns closer to 10-11%. I don't know for sure that the owner will accept 10-15% below market but I am trying to figure out what number makes it worth it for me!

One of the properties is listed for 200k, rents for 1870 a month and I've calculated an average of 724 in expenses per month (going overboard with CapEx and it has a 2 year old roof). That means buying the property at the listing price of 200k at a 20% down payment will give me a 6.6% CoC return. If I can get it for less or put less down then that only goes up.

Thank you for your response and I will run a more detailed NOI and Cap Rate calculation!

I have been looking at multifamily properties in my area and when I run the numbers with the current rents, buying for a price 10-15% below what it's listed for, and being very conservative (assuming the worst) with my expense calculations, the CoC returns are still upwards of 15%. I'm not sure if my area is just a great area or if my calculations are way off but it seems too good to be true and I was wondering if anyone could provide some tips on what to do in this situation!