How to Read a Rent Roll and a T-12
When a property already has tenants, two documents tell you more than any listing photo: the rent roll and the T-12. Learn to read them and you'll catch problems the seller would rather you didn't.
The rent roll: who pays what, and until when
A rent roll lists every unit, the tenant, the current rent, the lease start and end, and deposits. Read it for more than the totals:
- Below-market rents — upside if you can raise them, but not income you have today.
- Leases expiring soon — turnover and vacancy risk right after you buy.
- Concessions or "friends and family" rents — income that vanishes at renewal.
The T-12: twelve months of actual money
The T-12 (trailing twelve months) is the real income and expense statement for the past year — what actually came in and went out, month by month. It's the antidote to a seller's optimistic pro forma.
Compare the T-12 to the seller's projected numbers. If their pro forma shows expenses far below what the T-12 actually recorded, you've found where the deal is being dressed up. Trust the T-12.
What to reconcile
Make the rent roll and T-12 agree: does the income on the T-12 match the rents on the roll? Are there expense categories — repairs, management, utilities — that look suspiciously low or missing entirely? Gaps here are negotiating points, or reasons to walk.
Turn the numbers into a verdict. Feed the real figures into the EYRIE Deal Analyzer for a clean read on whether the deal works. See it on Etsy →