Discussions

We have a rental property, we got it really cheap and have slowly been doing upgrades as needed. It doesn’t make us any money, but we break even. In 10-15 years we will have a house that’s worth selling for a decent amount of profit. Thankfully we have great tenants so don’t run into any issues there... but my opinion will probably change if these tenants move on and we get stuck with bad ones haha.

The unknown said "What constitutes expenses? Every dollar? Or is it just hydro & property taxes? "

well it is a business so yes every dollar i spend on it counts as an expense somewhere but, if you are talking taxes there is different ways to claim your costs and that will affect how and when you pay taxes, eg. the principle portion of your mortgage is not an expense you claim but depreciation can offset that if you choose to depreciate the asset (usually not recommended but you could)  
 
TEN- LMAO its amazing how a few bad tenants can change your view of being a landlord, tenants can make or break you for sure

TEN said "I used to say that its a good investment however after having two rotten tenants in a row, I am now not so sure. We have a couple rental properties and and would ditch both at a loss just to relieve the headaches. "

I can tell who's the real deal, because they despise the RTB.

I should have been a bit clearer with my question. It has been brought up what the bank looks at for valuing a revenue property. The monthly income minus expenses X 12 divided by the 8% to 10%. What is considered expenses?

(The unknown) how do I get ahold of you. 4 plex for sale.

Usually the appraiser will use all of the obvious expenses(property tax, utilities, etc) as well as a small percentage for management 5-7% of gross rents(even if you plan to manage it yourself) and around 3-5% of gross rents for maintenance(or more if the building is older).  
Soft costs like bookkeeping banking fees would not be i:ncluded.  
 
Send me a PM if you’d like to grab a coffee some time.

Evergreen58 said "Usually the appraiser will use all of the obvious expenses(property tax, utilities, etc) as well as a small percentage for management 5-7% of gross rents(even if you plan to manage it yourself) and around 3-5% of gross rents for maintenance(or more if the building is older).   Soft costs like bookkeeping banking fees would not be i:ncluded.     Send me a PM if you’d like to grab a coffee some time. "

for the bank, i would agree for taxes everything you can lol