Hey BP!
I was hoping to get some input on a potential opportunity that has come my way. I have yet to see the property but I ran some very conservative numbers and am still showing decent cash flow. The duplex has already been renovated so it is doubtful that it will need $10,000 in repairs but I want to err on the side of caution. Rents in the area support $650/unit at the low end.
Purchase Price:$78,000.00
Purchase Closing Costs:$1,500.00
Estimated Repairs:$10,000.00
Total Project Cost:$89,500.00
After Repair Value:$90,000.00
Down Payment:$5,250.00
Loan Amount:$72,750.00
Amortized Over:30 years
Loan Interest Rate:4.00%
Monthly P&I: $347.32
Total Cash Needed
By Borrower:$16,750.00
Monthly Income: $1,300.00
Monthly Expenses: $1,011.15
Monthly Cashflow: $288.85
Pro Forma Cap Rate: 8.53%
NOI: $7,634.00
Total Cash Needed: $16,750.00
Cash on Cash ROI: 20.69%
Purchase Cap Rate: 9.79%
Total operating expenses: $663.83
Mortgage expenses: $347.32
Vacancy:$78.00
Repairs :$130.00
CapEx:$130.00
Insurance:$100.00
Management:$130.00
P&I:$347.32
Property Taxes:$95.83
Income-Expense Ratio (2% Rule): 1.45%
Total Initial Equity: $17,250.00
Typical Cap Rate: 8.00%
Gross Rent Multiplier: 5.00
Debt Coverage Ratio: 1.83%
ARV based on Cap Rate: $95,425.00
Income-Expense Ratio (2% Rule): 1.45%
Total Initial Equity: $17,250.00
Typical Cap Rate: 8.00%
Gross Rent Multiplier: 5.00
Debt Coverage Ratio: 1.83%
ARV based on Cap Rate: $95,425.00
