Numbers don't make sense (even with huge obvious profit margin)

[Brian Cheng]

So I am practicing analyzing deals just using a local home i found on realtor.com. Because I've used up the free trials of the BP calculator, I decided to just use another calculator to practice in the meantime. I ended up using free zilcalculator and basically put in the same numbers as i would if i was using BPcalculator. But when the analysis came out, basically i got a super huge negative CoC return which didn't really make any sense. I even lowered the buy price by a whopping 80k and the cash flow still ends up negative... I've attached the Zilcalculator hypothetical analysis for review. Can anyone tell me if I screwed up on entering the number some where? Thank you!

[Joe Villeneuve]

Originally posted by @Frank Jiang:

This calculator is really hard to read.  It looks like it was designed more for multifamilies or apartments than for single families.  Three things immediately jump out at me:

1) Utilities: Are you sure that you would be paying these as opposed to the tenant?

2) Property Tax: You're paying an effective 4.5% property tax rate.  I know that Texas property tax can be tough but this sounds ridiculously high to me.

3) Rent: You are only getting 1,500 per month on an ARV of 240K? Eek.

 I completely disagree.  This calculator was designed to confuse you to the point of no return (or in this case...returns).  I agree with you, and and @Jay Hinrichs  Analyzing rentals isn't brain surgery.  It's simple math.

Income - expenses (inc. mortgage) = cash flow (income)

Cash flow in first year (income)  =  CoCReturn
Cash spent in 1st year

This calculator, like most, is a train wreck.