Determining if a Multi Family Investment Property is worth further investigation.

Tue, 26 May 2009 03:56:00 GMT

I'm presently working with a number of real estate investors looking to start their portfolio of properties. Many are new to this investment. Since I have personal experience when it comes to Investment Properties such as Multi Family Homes I have a formula that lets me decide if a property is worthwhile investigating further. I recently passed this formula onto my clients and thought it might be of help to others out there looking to get into this.

I start by looking at the total monthly income. Multiply this total by 12 which will give me the yearly income. I then multiply this by 7X - 10X. The product of this equation would be the expected Sales Price of the property. When using the 10X multiplier I would consider a property that was in excellent condition, somewhat new or many updates, or has a great appreciation potential. A 10X multiplier will most likely be a break even property or slight positive cash flow. The lower the multiplier the greater the positive cash flow and the greater the deal. Once you determine a property is worth investigating further you then need to visit the property to determine it's condition as well as look into the overhead/expenses in owning this property. If the vacancy rate seems high in the area I recommend that you try to find something that is fully rented. If you find what you think is a good deal but it is not fully rented I suggest to give the vacant apartments a lower rental value. For example if there is a 3 Bedroom Apt empty and it would normally rent for $1500 p/m. I would give it a value of a 2 Bedroom Apt which might rent at $1200 p/m. I know if I were to get this property and advertised a 3 Bedroom Apt at a 2 Bedroom rent I would have no problem renting it.

If you need more info just let me know.

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EDUCATED YOURSELF BEFORE MAKING ANY REAL ESTATE RELATED DECISIONS

Sun, 22 Feb 2009 19:55:00 GMT

I SPECIALIZE IN EDUCATING AND ASSISTING MY CLIENTS WHEN IT COMES TO REAL ESTATE RELATED ISSUES. EDUCATE YOURSELF WITH ALL THE KNOWLEDGE YOU CAN GET VIA INTERNET&BOOKS. GET YOUR CREDIT RIGHT & INVEST WITH YOUR HEAD NOT OVER IT. START SMALL AND PURCHASE WHAT YOU CAN AFFORD WITH MONEY LEFT OVER. KNOWLEDGE IS POWERFUL!

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Why is the information you furnish all jumbled up and mostly hidden on my screen? It is useless.

Fri, 30 Jan 2009 15:08:00 GMT

You used to furnish clean screens. Now there are so many advertisements that they jumble all of the information and hide most of it. Please let me know why and how to fix it.

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Determining if a Multi Family Investment Property is worth further investigation.

EDUCATED YOURSELF BEFORE MAKING ANY REAL ESTATE RELATED DECISIONS

Why is the information you furnish all jumbled up and mostly hidden on my screen? It is useless.