Townhome Deal Analysis

[Steffan Daus]

I just got off the phone with my Realtor on this home, and it was put under contract because I initially thought I could not make it work out. I was talking it over with my dad @Alex Daus prior to that where we trying to find the error in my numbers.

Not wanting all the work we put into the numbers to go to waste, I would like to post my analysis anyways and get some feedback on what you guys think.

Some Background: I have pre-qualification for a USDA 0 down loan and planed to use that to purchase. The townhouse itself is a 3 bedroom 2.5 bath that was in decent shape. The plan was to live in it for a year with a roommate to keep costs down, then transition to a full blown rental in a year (per the conditions on USDA loans). We were having some trouble getting the Loan payment to sync with the lender's, was wondering if you could find the difference as well.

Variables	BP	Lenders number
Purchase price	$117,000.00	$117,000.00
Loan amnt	$117,000.00	$117,000.00
closing costs	$4,000.00	$4,000.00
Repairs	$5,000.00	$5,000.00
Rent	$1,200.00	$1,200.00
Monthly P&I	$525.38	$834.68
Taxes	$69.23
Insurance	$35.00
HOA	$145.00
PMI	$49.58
Vacancy (5%)	$60.00	$60.00
Rapairs (6%)	$72.00	$72.00
Cap ex (5%)	$60.00	$60.00
Management (10%)	$120.00	$120.00
Total Expenditures	$1,136.19	$1,146.68
Net Operating income	$63.81	$53.32
Cash on cash	8.51%	7.11%
Income-Expense Ratio	0.95%	0.95%
Cap rate	6.55%