There are several ways to verify the accuracy of a property's financials. One way is to analyze the deal using the seller's numbers. This involves running a property analysis based on the numbers given in the Offering Memorandum. You can also analyze the deal using historical operating data, which includes Property Rent Roll and Annual YTD Profit and Loss Statement. Another method is to analyze from a proforma perspective, looking at the property as if you were already the owner of it. This involves adding 12 months' worth of categories to your spreadsheet for projected income, expenses, capital expenditures and debt services.
Real estate can be a great addition to an investment portfolio. But as with any investment, it has t...
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