We came up with a way of measuring the fixed costs associated with the property and then a ballpark of their variable costs, and then compared that to current and market rent.
The fixed costs included:
- Mortgage payments
- Property taxes
- Property insurance
- Flood insurance, if any
- HOA fees, if any
Variable costs included maintenance, turnover, and vacancy. (We manage ourselves, so didn’t include that in the equation).
The sheet looks like this, with conditional formatting used to highlight any property that came out negative in red:
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