A rent roll analysis checklist: 7 things buyers miss

Most underwriting errors on smaller multifamily deals are not modeling errors. They are bookkeeping errors — a number used for something it doesn't mean, a line item silently dropped, a denominator quietly wrong. These seven checks are the ones that catch real money. Each comes from a defect we've caught and pinned in our extraction test suite.

1. Keep the four income definitions separate

Scheduled rent is unit rents × 12 — nothing else. Gross potential income adds ancillary income (parking, laundry, storage, pet rent, RUBS) at fully-leased levels. Effective gross income subtracts vacancy, concessions, and bad debt. NOI subtracts operating expenses — and debt service and capex are not operating expenses. A package that applies “EGI” to a rent-only number isn't using a stylistic shorthand; it is overstating the income base every downstream ratio sits on.

2. Carry ancillary income through the build

If the OM lists parking at $300/space in the pro forma while the rent roll notes say “parking included,” both can be true — one is current, one is market — but the gap is an underwriting assumption that needs a line of its own. Silently picking one number buries it.

3. Check the unit-count denominator

Garages, parking spaces, storage lockers, and commercial suites are not apartments. They don't belong in the residential unit count that drives $/unit pricing, occupancy, and rollover math; their income belongs in ancillary, not scheduled rent.

4. Reassessed property tax is the buyer's expense line

In reassessment-on-sale jurisdictions (California, Florida, many others), the seller's current tax line is structurally lower than what you will pay. Compute the post-sale tax from the asking price and the millage rate. When an OM shows current taxes and a higher buyer-budget tax line, that's correct treatment, not expense inflation — and when it shows only the seller's line, the delta comes out of your NOI, not the broker's.

5. Look for the reserves line. It's usually missing

Brokers routinely omit replacement reserves from the expense load. $250–300/unit/year on a small building is real money against NOI — on a 12-unit building at a 6% cap, a $3,600 reserves omission inflates value by $60,000.

6. Cross-check income against the headline KPIs

The OM's own marketing math is a free integrity check on the financials. GRM × asking price should reproduce gross income; broker NOI ÷ asking price should land in a sane cap-rate band for the asset class; stated $/unit × unit count should reproduce the price. On a 24-unit Missouri deal, 8.75 GRM × $2,450,000 implied $280,000 of income — which exposed that a $279,886 gross-scheduled-income line had been dropped from a spreadsheet rebuild. One multiplication caught it. An expense ratio over 100% on an occupied, stabilized building means a lost income line, not a doomed property.

7. Size the banked rent

In CPI-indexed rent-control jurisdictions, increases an owner didn't take don't vanish — they bank, and a buyer can pass them through. It is among the few income levers that needs no turnover, no renovation, and no market movement. Most rent rolls won't show it unless you ask for the increase history — another reason the diligence request should name documents, not topics.

The meta-rule

Every claim should tie to a number, and every number should tie to a source page. Where a broker is right, say so — checks 3 and 4 are as often vindication as indictment. The point isn't skepticism for its own sake. It's that an independent view requires independent arithmetic, and most of that arithmetic is one multiplication away.