New to analyzing deals .. Would you do this deal?
Good evening BP,
I am new to analyzing deals, I have put together this property and hope to learn if I am running numbers and assumptions correctly. Any advice, feedback is welcomed. Thank you
NOTE: Property List for $229,000 and is bank owned and I assumed $12,000 per unit for rehab.
Example A Rent 3 is $0 due to this being a house hack Strategy. Example B is with the unit rented out after One year.
EXAMPLE A: House Hacked
Address: 642 John Fitzgerald Kennedy Blvd, Bayonne, NJ 07002 Type: Multi-Family
** Unit Information **
Total Units: 3
Total Square Footage: 0
1 Unit: 3/1 (0 sq. ft., $1,500 Rent Per Month)
1 Unit: 2/1 (0 sq. ft., $1,250 Rent Per Month)
1 Unit: 2/1 (0 sq. ft., $0 Rent Per Month)
** Purchase & Rehab **
Purchase Price: $265,000 ($0/sq. ft., $88,333/unit)
After Repair Value: $325,000
Purchase Costs: $7,950
Rehab Costs: $0
Down Payment: $9,275
Total Cash Needed: $17,225
** Financing **
Loan Type: Amortizing
Loan Amount: $255,725
Loan to Value: 96.5%
Loan Term: 30 Years
Interest Rate: 5.25%
Monthly Payment: $1,412
** Cash Flow (Monthly) **
Rent: $2,750
Vacancy: -$275 (10%)
Expenses: -$1,348 (54.5%)
NOI: $1,127 ($376/unit)
Mortgage Payment: -$1,412
Cash Flow: -$285 (-$95/unit)
** Returns & Ratios **
Cap Rate (Purchase): 5.1%
Cap Rate (Market Value): 4.2%
Cash on Cash Return: -19.9%
Return on Investment: 243.2%
Return on Equity: -4.1%
EXAMPLE B: All units rented
** Unit Information **
Total Units: 3
Total Square Footage: 0
1 Unit: 3/1 (0 sq. ft., $1,500 Rent Per Month)
1 Unit: 2/1 (0 sq. ft., $1,250 Rent Per Month)
1 Unit: 2/1 (0 sq. ft., $1,250 Rent Per Month)
** Purchase & Rehab **
Purchase Price: $265,000 ($0/sq. ft., $88,333/unit)
After Repair Value: $325,000
Purchase Costs: $7,950
Rehab Costs: $0
Down Payment: $9,275
Total Cash Needed: $17,225
** Financing **
Loan Type: Amortizing
Loan Amount: $255,725
Loan to Value: 96.5%
Loan Term: 30 Years
Interest Rate: 5.25%
Monthly Payment: $1,412
** Cash Flow (Monthly) **
Rent: $4,000
Vacancy: -$400 (10%)
Expenses: -$1,648 (45.8%)
NOI: $1,952 ($651/unit)
Mortgage Payment: -$1,412
Cash Flow: $540 ($180/unit)
** Returns & Ratios **
Cap Rate (Purchase): 8.8%
Cap Rate (Market Value): 7.2%
Cash on Cash Return: 37.6%
Return on Investment: 300.7%
Return on Equity: 7.8%
