Prepared for: the owner · Prepared by: Eudy (AI-generated; reviewed and verified by Muhan Zhang) · Date: Sep 3, 2026 · Period: Sep 2025 – Aug 2026 (12 months, cash basis, AppFolio)
Units: 6 (3 stories; 2BR/1BA 710 sf per analyzer — Apartments.com shows 1BR/673 sf; rent roll needed) · Year built: 1920 · Basis: $700,000 ($116,667/door) · Economic occupancy: 97% of in-place GSR
| Where it is Actual NOI (T12, corrected) | Where it should be Eudy standard NOI | The gap Found money / yr | Worth at a 7% cap Gap ÷ 7% |
|---|---|---|---|
| −$6,691 | $44,748 | $51,439 | ≈ $735,000 |
Property Grade: D. The building collected 97% of its rent this year and still lost money, because $45K of repairs ($7,538/door, 6x the standard) and a $53K mortgage booked as an operating expense sit on a P&L that never sees the $17K tax bill.
| Received | What it is | Used for |
|---|---|---|
| The owner’s AppFolio T12 export (Sep 2025 – Aug 2026) | AppFolio 12-month cash flow · received Sep 3, 12:09 AM | All income and expense actuals |
| Still missing | Why it matters |
|---|---|
| Rent roll | Confirms in-place rents, unit mix, and lease expiries |
| Tax bill | Taxes are not on this T12 — $16,975 carried from the 2025 analyzer as an estimate |
| Loan statement | Mortgage is on the T12 at ~$4,523/mo; terms unknown, model uses Eudy default debt — and it splits P&I from escrowed taxes/insurance |
| Photos | Used a listing photo for now |
"Should be" = Eudy standard: $1,295 market rent (2BR/1BA comp, analyzer Rent-UnitMix tab), 6% stabilized vacancy, rules-of-thumb expense lines. Every actual ties to the T12 by account label.
| Line | Where it is (T12) | Per door | Should be | Per door | Gap | Read |
|---|---|---|---|---|---|---|
| Gross scheduled rent | $81,864 (in-place $1,137) | $1,137/mo | $93,240 | $1,295/mo | −$11,376 | Loss to lease 12% — verify with rent roll |
| Rent collected | $79,388 | $13,231 | $87,646 (6% vac.) | $14,608 | −$8,258 | 97% collected — vacancy is NOT the problem this year |
| Other income (late, legal, damage) | $1,174 | $196 | $0 | — | +$1,174 | $616 is eviction recovery — nets against eviction cost |
| Effective gross income | $80,562 | $13,427 | $87,646 | $14,608 | −$7,084 | |
| Property taxes | $16,975* | $2,829 | $16,975 | $2,829 | $0 | *Not on T12 — owner-paid; 2025 figure, need the bill |
| Insurance | $7,862 | $1,310 | $7,862 | $1,310 | $0 | Paid in one shot in March — run-rate, not a spike. 5x the $250 floor |
| Repairs & maintenance (all) | $45,226 | $7,538 | $7,050 | $1,175 | −$38,176 | Routine $9,765 · Routine* $30,796 · Replacements $4,665 |
| Management | $4,731 (5.9%) | $788 | $5,259 (6%) | $877 | +$528 | In line |
| Eviction costs | $4,340 | $723 | $0 | — | −$4,340 | Nov, Jan, Feb, Apr — one tenant, four months of filings |
| Legal & professional | $1,750 | $292 | $900 | $150 | −$850 | Mar–Apr, same eviction |
| Marketing (leasing fees) | $990 | $165 | $600 | $100 | −$390 | 2 turns |
| Water / sewer / trash | $4,697 | $783 | $3,361 | $560 | −$1,336 | Sewer up 32% on 2025 — check for a leak or a billing catch-up |
| Electric / gas (common) | $682 | $114 | $891 | $149 | +$209 | In line |
| Mortgage booked as opex | $53,486 | — | $0 | — | reclass | Debt service, not an operating cost — but the ~$4,523/mo likely includes escrowed taxes/insurance; the loan statement splits P&I from escrow, and only P&I leaves opex |
| Total operating expenses | $87,253 | $14,542 | $42,898 | $7,150 | −$44,355 | |
| Expense ratio | 108% | 49% | ||||
| NET OPERATING INCOME | −$6,691 | −$1,115 | $44,748 | $7,458 | −$51,439 |
Reconciliation (the gate): EGI ties to T12 Total Operating Income ✔ $80,562.13 · Expense lines sum to T12 Total Operating Expense ✔ $123,763.63 (difference $0.00) · T12 NOI ✔ −$43,201.50. Corrected NOI = T12 NOI + $53,486 mortgage reclass − $16,975 estimated taxes = −$6,691.
Expenses shown after the mortgage reclass; before the owner-paid $16,975/yr tax estimate. The Mar and Jun craters are the eviction's legal peak and the concrete/blacktop + door month. Source: AppFolio T12, tied to the cent.
1. Repairs are the whole story — $45K, $7,538 per door, 6x the standard ($38K gap). This isn't a maintenance problem, it's three capital projects and one bad tenant running through the operating account. The months tell it: $8,000 of painting in Feb and Apr, $5,500 of concrete and blacktop in Jun, $4,480 of door replacements the same month, and $5,481 of make-ready spread across Sep–Jan (five straight months — that's a unit that sat while it got fixed). Strip those four items ($23.5K) out and R&M is ~$21.7K, still 3x standard but mostly turn-driven. The building is 106 years old; some of this is real. But paint, blacktop and doors are CapEx — they belong below the NOI line, in a reserve, not on a P&L that a lender or a buyer reads. Two moves: reclass the capital items, and set a $250/door/yr reserve so next year's project doesn't look like an operating loss.
2. One eviction cost ~$11K all-in and took six months. Eviction filings in Nov, Jan, Feb and Apr ($4,340), legal in Mar–Apr ($1,750), and the rent trough — Nov collected $4,480 against $6,822 scheduled. Add the make-ready after and you're at $11K+ for one unit. The $616 of "Legal Fees – Tenant" income is the recovery; it's not revenue. Screening and a 5-day-late-notice discipline are cheaper than any contractor.
3. Rent held up — 97% collected — so the upside is in the rents themselves, not occupancy. Collections were $79.4K against $81.9K in-place; Apr–May ran $8.7K/mo, which means either rents were raised on turns or back rent came in. Either way: at $1,295 market the same 6 units gross $93K. The tenant who says "you raised it a lot, we want to stay" is telling you the number is right and the relationship is worth keeping. Take market on every turn, 3–5% on renewals, and never trade a $6K turn for a $150 bump.
4. Taxes and insurance are $24.8K — 31% of collected rent — and taxes aren't even on the books. Insurance ($7,862, $1,310/door) is on the T12 now, paid in one March hit; that's 5x the $250/door floor, so get two quotes on a 1920 six-unit — RI rates have moved but this still reads high. Taxes at $2,829/door (18% of GSR vs. 9% rule of thumb) are owner-paid and invisible to the PM, which is why the AppFolio NOI (−$43K) is fiction in both directions. Add taxes as an owner-paid memo line, take the mortgage out, and the monthly will finally show the truth.
5. What's fine. Management 5.9%, common electric/gas $114/door, collections. Sewer needs one look ($3,019, up 32%). Don't spend attention anywhere else.
Multifamily Analyzer method. Debt at Eudy defaults (25% down, 7.00%, 25-yr) because no loan statement came in — the T12 shows an actual payment of ~$4,523/mo ($54.3K/yr, likely P&I + escrow); replace when the statement arrives. Where the $700,000 basis comes from: the strike price you tested in the 2025 Multifamily Analyzer — not an appraisal. Send your actual basis (purchase price + capital put in) and every ratio below re-computes.
| As it is (actual NOI) | As it should be (standard NOI) | Delta | |
|---|---|---|---|
| NOI | −$6,691 | $44,748 | +$51,439 |
| Cap rate on $700K basis | −1.0% | 6.4% | |
| Value at 7.0% cap | n/a (negative) | $639,000 | |
| Annual debt service (25/7/25) | $44,527 | $44,527 | |
| DSCR | −0.15 | 1.00 | |
| Cash flow before taxes | −$51,218 | +$221 | |
| Cash-on-cash (on $201K in) | −25.4% | 0.1% | |
| Price at which DSCR = 1.20 | n/a | $586,000 |
NOI needed for DSCR 1.20 at $700K: $53,433 — standard NOI + $8.7K: rents at market and R&M at standard and insurance re-quoted to ~$1,000/door.
| Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | |
|---|---|---|---|---|---|
| Rent growth / vacancy | 0% / 10% | 0% / 8% | 3% / 6% | 3% / 6% | 3% / 6% |
| GSR | $93,240 | $93,240 | $96,037 | $98,918 | $101,886 |
| EGI | $83,916 | $85,781 | $90,275 | $92,983 | $95,773 |
| Total expenses | $42,898 | $44,578 | $46,340 | $48,189 | $50,129 |
| NOI | $41,018 | $41,203 | $43,935 | $44,795 | $45,643 |
| Cap rate on basis | 5.9% | 5.9% | 6.3% | 6.4% | 6.5% |
Assumptions: tax +3%/yr, insurance +8%/yr, other +3%/yr, reversion cap 7%, cost of sale 2%. Owner-supplied overrides: none yet.
| # | Move | $ / yr | Effort | Owner | Due |
|---|---|---|---|---|---|
| 1 | Reclass the books: mortgage P&I out of opex (keep the escrowed tax/insurance portion as the real expense it is — the loan statement gives the split), paint/blacktop/doors ($18K) to CapEx, legal-fee income netted against evictions | $0 cash, +$71K of reported NOI | Low | PM (RPM) | 30 days |
| 2 | R&M discipline: $1,000 approval threshold, quarterly CapEx plan, $250/door reserve funded monthly | $15–20K | Med | Owner + PM | 60 days |
| 3 | Market rent on every turn, 3–5% on renewals; keep the tenants who asked to stay | $5–11K over 24 mo | Low | PM | Rolling |
| 4 | Insurance: two quotes on the 1920 six-unit | $1.5–2.5K | Low | Owner | Before March renewal |
| 5 | Screening + late-notice SOP after a 6-month eviction | $5–11K avoided | Low | PM | Now |
| 6 | Sewer bill review (+32% YoY) | $0.5–1K | Low | PM | 30 days |
T12: The owner’s AppFolio T12 export (Sep 2025 – Aug 2026) (AppFolio, cash basis). Market rent: analyzer Rent-UnitMix comp $1,295 (Aug 2026) — refresh with Zillow/Rentometer at review. Rules of thumb: Eudy Multifamily Analyzer ROT column. Photo: Apartments.com listing photo. Property grade D: negative corrected NOI, 108% expense ratio, R&M 6x standard — offset by 97% collections and rents within 12% of market; provisional until the rent roll and tax bill arrive. AI-generated, reviewed by Muhan Zhang before release. This is an operating diagnosis, not an appraisal or an offer.