BiggerPockets

Does anyone have advice on how to create a cashflow projection sheet, for both analysis and investor presentations.

Yes. For a real world analysis, subtract the mortgage payment (P & I only) from 1/2 of the gross rents. That will give you real world cash flow (over time).

To dazzle ignorant newbies, make up some elaborate spread sheet; leave out about half of the real world expenses; and include a bunch of nonsensical terms like cap rate, Internal Rate of Return, and other meaningless gibberish.

Mike

Enzennio, If you do some reading, you'll see Mike owns quite a number of rental properties.

Any number you put in a spreadsheet for appreciation is nothing but a guess.

Pretty hard to predict operating costs when a lot of the biggies are very unpredictable. If you own dozens of properties for multiple years (like Mike), big expenses things like nasty evictions and major repairs average out. Hence the 50% guidelines. For a small investor like me, most months are quite a bit better, with just taxes and insurance as the only expenses. But every now and then you have a big hit. Even a small hit, like a tenant bugging out, has a huge effect on the cash flow for that property.

Depreciation is overrated, IMHO. The main benefit for depreciation is to shelter the rental income from taxes. I've seen many potential properties presented with a complex spreadsheet showing the "tax benefit" from depreciation and ending up with after tax cash flow higher than before tax cash flow. There are numerous limitations on someones ability to do that, and it really only works for a bunch of properties if you're in the real estate business. The kicker with depreciation is that it turns into taxable income when you sell.

Thanks for the feedback.

Are any of you willing to share what you would use for a presentation to investors/lenders.

All of your feedback is really appreciated.