Some Problems...

I have been spending the past few days trying to figure out this whole blog thing, and I can not seem to find any answers. So I am making a request out to other bloggers that may read this blog. If you have any idea on how to attach pictures to your blog, attach excel documents and/or charts to your blog, and maybe even some video to your blog as well. I would greatly appreciate some advice, or the name of a website that may give some meaningful information about these questions of mine. Thanks in advance.

Investing in Duplexes, Triplexes, and Quades

This is a decent book about buying investment properties, especially those that the title mentions. I particularly like the Valuation of Your Property Chapter (Chapter 8).

It goes into decent detail about a few different numbers one should look at when evaluating a deal to purchase. Some such numbers would be...

Gross Rent Multiplier (GRM) -
GRM = Purchase Price / Gross Scheduled Income
Ex. Property #1 Price: $245,000
Rents: $1,300 X 12 = $15,600/year
$245,000/$15,600 = 15.7 GRM
* One can also use this formula to estimate the cost of an investment property as well

Cash Return on Investment (ROI) -
ROI = Remaining cash after all expenses / initial investiment
Ex. $3,000 / $25,000 (Down Payment) = 12%

Margin -
Margin = 100 - operating expenses plus debt service / gross potential income
Ex. Gross Potential Income (100% occupancy) $31,000
Less Operating Expenses -$5,000
Net Income $26,000
Less Debt Service -$20,000
Cash Flow $6,000

Debt Service $20,000
Operating Expenses $5,000
Total Expenses $25,000
Accordingly: total exp $25,000 / gross potential income $31,000 = 80.6% break even
Thus, your margin is 19.4 % (100% - 80.6% = 19.4%)

Cap Rate -
Cap Rate= NOI / Purchase Price
Ex. $50,000 / $500,000 = .10 = 10%
*One can also use this formula to estimate the value of an investment property as well
Ex. NOI / Cap Rate
$50,000 / .09 = $555,555

Over all I believe that this is a very useful book. I believe that it is worth the read. Again its title is Investing in Duplexes, Triplexes, and Quad by Larry B. Loftis, Esq.