It depends on what you are buying and where. I have been doing it for about 10 years now in the Dallas, TX area. I am an investment sponsor/General Partner. If you send me an e-mail I would be happy to discuss with you your area of concentration, etc to hopefully lead you in the right direction.
You will first need to define your criteria before you can even make out a checklist. Narrow it this way: State, city, area within the city
Type of property- when built (age range), type of construction, preferred unit mix, blue collar/white collar, low income, medium income, high income, potential redevelopment areas or stable long term areas, bad areas
Number of units, size, type, amenities, etc.
There are internal checklists- property financials, property condition physically, age of components on property (roof, HVAC, Hot water heaters, plumbing, appliances, etc), city code issues, inspection scores, current rents, current occupancy, unit mix, crime on the property, etc
External lists- occupancy and trend in the state, city, and submarket. Rents and occupancy in the 10 closest competitive properties to the one you are purchasing, rent rate trend expected for area, regulatory issues, condition of competing properties and comparison of their amenities and "niceness" vs. yours, etc
The lists go on and on. To do proper due diligence it is a lot like work if you do it right, if you do it wrong you might need a second job to pay for the mistakes.
I have seen the city water rate kill the potential of a deal to work, a year later they raised the rate yet again which would have killed it even more dead- saw that deal killer after 8 years in the business. Somebody bought that property for more than what I would pay, hopefully they will have success but my gut told me I wouldn't at the same price.
Contact me if you want to discuss. firstname.lastname@example.org
Jan 17, 2011