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Updated over 3 years ago on . Most recent reply

User Stats

14
Posts
3
Votes
Venel Rene
  • Investor
  • Florida
3
Votes |
14
Posts

Would you close with these numbers?

Venel Rene
  • Investor
  • Florida
Posted

This is a 5/4 single family 2 floor home in the Kissimmee area that was perviously used as a short term investment home. Seller agreed to transfer/hand over all pre-existing bookings for the property. The house doesn't appear to need much work, beside minor cosmetics so the repair budget is low. Would you close on this, based off these numbers?

Property Information:
Purchase Price: $390,000.00
Estimated Repair Costs: $6,500.00
Down Payment: $39,000.00
Amortized Over: 30 years
Loan Interest Rate: 3.200%
Monthly P&I: $1,517.96


Income:
Estimated monthly income  $5,200.00

Monthly Expenses:
electricity $300.00
water & sewer $70.00
hoa fees $65.00
pool $95.00
Vacancy $520.00
Maintenance $260.00
Cap. Ex. $260.00
Management $520.00
Insurance $111.00
Property Taxes $354.00
Mortgage Payment $1,517.96
Total $4,072.96

Monthly Cash Flow: $1,127.04
Cash on Cash ROI: 24.18%

Financial Projections:

Total Initial Equity: -$ 351,000.00
Gross Rent Multiplier: 6.25
Income-Expense Ratio (2% Rule): 1.28%
Typical Cap Rate: 8.14%
Debt Coverage Ratio: 1.74
ARV based on Cap Rate: $ 390,000.00


50% Rule Cash Flow Estimates:

Total Monthly Income: $ 5,200.00
x50% for Expenses: $ 2,600.00
Monthly Payment/Interest Payment: $ 1,517.96
Total Monthly Cash Flow using 50% Rule: $ 1,082.04

This feels like a good deal based off the number, but It also put me on top of my budget.

Most Popular Reply

User Stats

413
Posts
412
Votes
Joshua Strickland
  • Investor
  • Flowery Branch, GA
412
Votes |
413
Posts
Joshua Strickland
  • Investor
  • Flowery Branch, GA
Replied

Where else would you be able to get a 25% CoC return? I'd close on it if those were my numbers. Also if you self manage the CoC would skyrocket. If it isn't your thing fine, but you may find it easier than you think.

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