Please help me evaluate this investment property in Central TX
Hi All,
First Time investor.
Investment Strategy: Buy and Hold
Investing here because: Potential to Appreciate in Long Term (10yrs+), want to build Net Worth, Affordable in my budget
Year 1 Evaluation:
- Gross Monthly Rental Income = $2,042.50
- Monthly Cashflow = -$76.05
- GRM = 12.79
- Cap Rate = 5.12%
- CoC ROI = -1.11%
Hoping that the interest rates go down so that the monthly cashflow becomes +ve. But if I move forward assuming the current interest rate and 3% inflation, this is what I getting:
Year 5 (Expected with 3% inflation rate) Evaluation:
- Gross Monthly Rental Income = $2,298.85
- Monthly Cashflow = $180.31
- Cap Rate = 6.05%
- CoC ROI = 2.62%
Year 10 (Expected with 3% inflation rate) Evaluation:
- Gross Monthly Rental Income = $2,665.00
- Monthly Cashflow = $546.45
- Cap Rate = 7.38%
- CoC ROI = 7.95%
Need help in understanding if I am missing any KPI. Should I consider anything else while evaluating this property?