CalculateRealEstateROI

Multifamily

How do I underwrite a multifamily deal?

Pull T-12, normalize expenses, stress vacancy/rate, verify rent comps, model exit cap 50–75bps higher than entry.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

Pull T-12, normalize expenses, stress vacancy/rate, verify rent comps, model exit cap 50–75bps higher than entry.

Expanded explanation

Never trust broker pro forma. Verify in-place rents via rent roll AND signed leases. Adjust expense ratio to 40–55% range for stabilized. Stress-test DSCR at +200bps rate.

Examples

  • 20-unit deal: T-12 NOI $180k, broker pro forma $260k — reject.

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