Last week, I toured a 90-unit multifamily that looked fantastic on paper. Strong projections, great story, and marketed as Class B.

After submitting an offer, the seller came back with a 30% higher counter, essentially pushing the price back to what the property traded for during the peak market a few years ago.

Before revisiting my underwriting, I decided to tour the property in person.

What the OM described as Class B was clearly Class C.

And the tenant profile appeared even lower than expected.

Within minutes, a few quick field checks told the real story:

🚗 Parking Lot Test
1. Types and condition of vehicles.
2. Mostly older vehicles with visible wear
Cars with temporary or expired tags
3. Work vans or trucks parked overnight
Vehicles parked irregularly or taking multiple spots

These often signal the income profile of the tenant base.

👀 Midday Activity Test (10 AM – 2 PM)
1. Multiple residents outside during midday. 2. Groups hanging around stairwells or parking areas.
3. Loud activity or loitering

Stable workforce communities tend to be much quieter during the day.

🏘️ 3-Block Neighborhood Scan – Drove 3 blocks in every direction.
1. Retail mix (discount stores vs service-oriented retail)
2. Condition of surrounding homes
3. Abandoned properties – tall uncut grass
4. Density of liquor stores, check-cash places, pawn shops

The reality: a property’s class is determined more by its neighborhood than by its renovations.

Big learning:

— Proximity to a larger city does not always translate to a strong location.

— Micro-location, neighborhood dynamics, and tenant profile ultimately determine how a property will perform.

— No amount of spreadsheet underwriting replaces walking the property and observing the environment firsthand.