I was just doing my usual due diligence, market researchthere was this one MONSTER of a commercial multi-unit that was beyond our price range (6 tenant offices rental).but we thought it was way over priced. we thought it was worth 600k (old bldg), listed 980knet gross income was 80k/yr, it already has 80%-90% occupancywe were thinking an offer of 700kbut we thought that was too low an offer, and financing could happen if we tried hard enough.we ended up buying a few building down at a more affordable 150k.today I remembered the building.... chked in on loopnet. and it was still there!!!!

I'm really surprised at some of the responses....to do this full time i'd recommend people consider having 6 months reserves of living expenses and another 2x of what your monthly gross is before you go fulltime.So in that case someone with monthly expenses of 3000/month would ideally want roughly 18-20K of reserves before they even THINK about going fulltime.

From the gross profit, you pay back yourself for all of your costs (rehab, plus anything else, such as utilities).

My uncle has managed them for the last five years and has a pretty good scope on the costs, pitfalls, ect.Asking price (and matching recent 3rd party appraisal) $320k25% down = $80kEstimated closing costs $10kAll 4 houses are rented for a total of $5k gross ($60k annual)(Many tenants for over 10yrs and 2 due for rent increase)Mortgage ($240k) @5% =$1320Taxes $8kManagement (uncle continues to manage) $6kInsurance $3200Maintenance $4kTotal expenses = $37kNet =$23kAssuming $90k investment, that comes to 25% return on cash!

So my initial investment of $500,000 capital has now grown to  approximately $1500000+Gross return - $201600 paNet return - $120,960 pa2018 - rinse and repeat...

The following assumptions also apply:- 6 month hold from buy to resale- 6% realtor commission- Hard Money loan @ 4 points + 15% APR interest w/9 mo. balloon- Rehab of ~ 35KAfter accounting for some closing costs and other holding costs, my model is showing a "probable" pre-tax gross profit of about $12K, with potential upside to 25-ish if we only hold for 4 months, nail the rehab budget with no overage, get the list price, etc...Do these numbers smell right to other folks?

I would be looking to gross at least $1600.

That means you will have $800k gross at the end.

Easy formula:Take gross expected income of property and then times .50.So example of 2,000 a month X 12 months = 24,000 GEI / .50 = 12,000 NOIValue of property at a 10 cap would be 120,000 sales price going in if the property doesn't need immediate work to get rent ready.If landlord paid utilities make the number .60 expenses.

So, by living in one unit, you are left with $228 gross less operating expenses associated with the second rented unit. i will assume you will not cause damage to your own property.Once you move out, your NOI will be $625 monthly based on the 50% rule and your cash flow after debt service will be $228 monthly which exceeds the minimum $100 per door goal.Looks like a base hit to me too!