What a complete rent roll shows
Unit number, bedroom and bath count, square footage, tenant name, current rent, lease start and end, security deposit held, move-in date, any concessions, and balance owed. Vacant units should appear with an asking rent rather than being quietly omitted. On small multifamily you will often receive something handwritten or a spreadsheet with three columns, which is itself information: an owner who cannot produce a clean rent roll usually cannot produce clean financials either, and that is frequently where the value-add opportunity lives.
Reading it like an underwriter
Compare in-place rents against market to size the loss to lease, then ask why the gap exists — long-tenured tenants, dated interiors, and an owner who never raised rent are three very different repair jobs. Look at lease expiration dates: a stack of leases all ending in December in a cold-weather market is a turnover problem waiting to happen. Count month-to-month tenancies, which cut both ways. Note concessions, since a unit at $1,200 with two months free is not a $1,200 unit. And read the delinquency column, because collections tell you more about management than any narrative in the offering memorandum.
Verifying it
Trust it after you check it. Match the rent roll to the actual leases, then to twelve months of bank deposits or the trailing operating statement — if collections consistently run below scheduled rent, the difference is your real vacancy and credit loss. On larger deals, tenant estoppel certificates confirm terms directly with residents. Confirm exactly what security deposits transfer at closing and how your state requires them to be held, since deposit rules vary and inheriting an underfunded deposit liability is a common, avoidable surprise.
On a single-family rental
The document still matters when there is only one unit. You want the lease, the rent, the deposit, the renewal date, the payment history, and any side agreements the seller made — a discounted rent for a tenant who mows the lawn is not visible anywhere else. Buying a tenanted house means inheriting that tenancy on its existing terms in most states, including notice requirements you did not write, so read the lease before deciding the rent can simply be raised at closing. Confirm what local law requires when ownership changes.
Put it to work
Related terms
- Pro forma — A projected income and expense statement for a property — what it should do, not what it has done.
- Vacancy rate — The share of potential rental income lost to empty units over a period.
- NOI (net operating income) — Annual rental income minus all operating expenses, but before mortgage payments and income taxes.
- Operating expense ratio — Operating expenses divided by gross operating income, shown as a percent.