Duplex Investment- Need help with analysis

[Joe Garvin]

Need 

Duplex- asking price $169,900- thinking of offering $159-161K

Rents: $850 & $750 ($1600) both should be raised to $900

Taxes: $1144

Down Payment: 30%

Below is the report I ran with a purchase price of $159500.  The owner bought this property in in 11/2013 for $71,400 and has made some improvements.  Here ate their comments:

Many upgrades were completed to this property a few years ago. New kitchen, new ac systems, flooring and paint. Each unit has a rental value of about $850/month totaling $1,700/month gross income. 

Monthly Income: Monthly Expenses: Monthly Cash Flow: Pro Forma Cap Rate:

$1,650.00 $1,158.05 $491.95 7.05%

NOI Total Cash Needed Cash on Cash ROI Purchase Cap Rate

$12,692.00 $55,166.50 10.70% 7.96%

Property Information

MLS Number:

Purchase Price: $159,500.00

Purchase Closing Costs: $2,200.00

Estimated Repair Costs: $4,000.00

Total Cost of Project: $165,700.00

After Repair Value $180,000.00

Property Description

Public Remarks: Great Investment Opportunity!  This duplex features (2) 2 bed /

1 bath units. Many upgrades were completed to this property

a few years ago. New kitchen, new ac systems, flooring and

paint. Each unit has a rental value of about $850/month

totaling $1,700/month gross income.

Down Payment: $47,850.00

Loan Amount: $111,650.00

Loan Points: $1,116.50

Loan Fees:

Amortized Over: 30 years

Loan Interest Rate: 4.500%

Monthly P&I: $565.71

Income

Rent $1,650.00 Other $0.00

Total $1,650.00

Expenses

Vacancy $57.75 (4%) Repairs $123.75 (8%)

CapEx $49.50 (3%) Insurance $166.00 (10%)

P&I $565.71 (34%) Property Taxes $95.33 (6%)

Misc $100.00 (6%)

Total $1,158.05 (70%)

Buy & Hold Analysis - 01/24/18 07:17:39

PM Page 1 of 3

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Financial Projections

Total Initial Equity: $68,350.00

Gross Rent Multiplier: 8.06

Income-Expense Ratio (2% Rule): 1.00%

ARV based on Cap Rate: -

50% Rule Cash Flow Estimates

Total Monthly Income: $1,650.00

x50% for Expenses: $825.00

Monthly Payment/Interest Payment: $565.71

Total Monthly Cashflow using 50% Rule: $259.29