I subtracted soft costs, etc. for this analysis.

If its not on any tax returns, they take 75% of the rent and subtract the PITI payment.

Cash flow is what is left after all expenses are subtracted from rental income, it can be positive or negative.

Learn MAO, subtract your assignment fee, and never, never, never violate MAO. 

Don't forget you will have selling cost to subtract.

Then they kept track of every subdivision over the years and if you subdivided and used  a "building right", it was subtracted from the 4 total. 

Subtract these debts from the after repair value (along with guesstimate of repair costs).

Take away one month for vacancy loss.You now have your Effective Gross Income, which is $19,250.From that you take away 50% for operating expenses like Taxes, Insurance, Repairs and Maintenance, HOA Fees, and a Management Fee.You are now left with your Net Operating Income, which equals $9,625.The Principal and Interest Payments equal $535 monthly, which equates to $6,420 in debt service annually.You take your NOI and subtract your Debt Service.

Use the 50% rule to get an idea of what you would pay for the building if the utilities were already split, then subtract the cost of the upgrade from the offer price.Or, figure your expenses with all utilities, and work from there to figure out what your max offer might be.Hope that helps,Kelly

I would get a quote for doing the work to your standards, and subtract that amount from your initial offer price.