If rentals you always have the ugly Blue State thing waiting to popup.Too many variables.

Hi Sarah, A "good" Ground Up pro forma should be structured to identify the key inputs as variables that can easily be changed in isolation or in combination to report information that is pertinent to the project and its Stakeholders (Investment Partners and Developer).The central reported elements should include project performance predicated on a Merchant Build (Build and sell one year from rent up or sell out) AND based on an inferred holding period as well as provide a short but comprehensive Cost Recap (Total Project Cost for Land-On and Off Site Cost, Hard cost (slab up), Soft Cost and Cost of Capital (Financing costs and fees).

It’s amazing how many wildly variable stories and circumstances we can see and hear about in this industry.

The cash flow given accounts for variables in repairs, vacancies, and capital expenditures over time averaged out as a monthly expense, as these are impossible to guess exactly right over decades(especially capex).

What I am confused about is, if I get a HELOC for 300K and this HELOC has a fixed 8% APR (I would try my best to get a fixed rate HELOC vs variable), and I (for example) then buy a 150K house and put down 20% (equals 30k).

I recommend you do this each year to adjust for utility increases and other variables.

I know every once in a while you can get decent furniture second hand that will be nice enough to use but in the event I can’t find something I will have to buy it outright and that’s a variable that will be harder to be calculated. 

I know I am being vague and there is multiple variables involved here, i.e. the numbers, the area, my personal knowledge, ect... but what are some of your experiences?

So many variables.

There are various options/variables to consider and too easy to miss a key item.