Please help me evaluate this investment property in Central TX

[Dipesh Kashiv]

Hi All,

First Time investor.

Investment Strategy: Buy and Hold

Investing here because: Potential to Appreciate in Long Term (10yrs+), want to build Net Worth, Affordable in my budget

Year 1 Evaluation:

• Gross Monthly Rental Income = $2,042.50
• Monthly Cashflow = -$76.05
• GRM = 12.79
• Cap Rate = 5.12%
• CoC ROI = -1.11%

Hoping that the interest rates go down so that the monthly cashflow becomes +ve. But if I move forward assuming the current interest rate and 3% inflation, this is what I getting:

Year 5 (Expected with 3% inflation rate) Evaluation:

• Gross Monthly Rental Income = $2,298.85
• Monthly Cashflow = $180.31
• Cap Rate = 6.05%
• CoC ROI = 2.62%

Year 10 (Expected with 3% inflation rate) Evaluation:

• Gross Monthly Rental Income = $2,665.00
• Monthly Cashflow = $546.45
• Cap Rate = 7.38%
• CoC ROI = 7.95%

Need help in understanding if I am missing any KPI. Should I consider anything else while evaluating this property?