Line 5: 20,000Line 6: 150,000Line 7: AGI 125,000Line 8:(Subtact line 7 from line 6) 25,000 Line 9:(Multiply line 8 by 50%) 12,500 Line 10:(Enter smaller of line 5 or 9) 12,500 Thanks in advance,Winston

Figure out your cap rate of your current properties and if you are comfortable with that cap rate, multiply it by the sellers NOI, this should give you a purchase price that is fair to you and most of all, you can explain how you came up with it.

Apartment buildings are worth about 8 to 15 times their annual gross income and it is called a Gross Multiplier (GM) The number for the GM depends on the quality of the area the building is in.

But the extreme leverage crowd would have you invest every penny you have and multiply it 5X by leverage.

It turned out to be around 12 hours of maintenance a year, multiplied by his hourly rate of $50 an hour discounted to $42; $504/year.  

To do that we analyze what the buildings net rent rate would be and multiply that by the magic Multiple.

In my gig as volunteer, I swear someone told the garbage bags to be fruitful and multiply.

Just take the 5 I sent over and multiply by 20 and let's see where it comes in. 

Then multiply that number by 1000 and that will give you debt amount current income will cover.  

basically, what you need in btu for each unit can be calculated by multiplying the square footage of each unit by 3.5. i. e., a 1000 sq ft unit would need a 35,000 btu furnace at minumum. then you have to consider the distance from the furnace to the unit is services. if the building is a 3 story with a couple of apartments on the top floor, then those units should have at least 10,000 more btu than the calculation calls for. if each unit has the furnace within the apartment, then the calculation is what you go by. most systems are pretty much the same, but, just like a car, there are some brands that simply cost more to repair based on parts and such. trane seems to be among the most expensive. i recommend goodman. easy to install, easy to work on and parts are reasonable. no one can calculate the timing of repairs on any unit. i have seen 3 year old furnaces need work and i have seen some go for several years without an issue. too many variables to figure that out. if you are talking about having one unit for the entire building, same formula applies to the sq footage, however, i would not recommend this because inevibly, some apartments will not get as much heat as others, and with one furnace, you cannot control the heat going to each apartment. a boiler system could do that but if you don't already have one, it is going to be massively expensive to have one put in. in an inspection, look for the age of the furnace, this can be found in the model number in most furnaces. usually the 1st and second digits are the month it was build, and the 3rd and 4th is the year. however, this is not on all furnaces. basically, get the model number and look it up on line. anything over 15 years old is probably on its last leg and about as fuel efficient as a campfire. also, look for how clean the furnace is. if it is dirty, chances are it hasn't been service often enough. i would have it cleaned out at least once every 3 years at a minimum. change the filter at least once a month, especially in the winter months. a clogged filter not only can lead to premature damage to the heat exchanger, but will also effect the output and efficiency of the unit and could possibly poison your tenants with co2 gas. i hope this helps you, please let me know if you need any further assistance