This is my first deal im analzying

4 Replies

Hi guys i'm new to bigger pockets. this is my first deal. any advice? thanks

2 bedrooms, 2 bathrooms.

Purchase Price: $45,000.00
Purchase Closing Costs: $3,000.00
Estimated Repairs: $10,000.00
Total Project Cost: $58,000.00
After Repair Value: $45,000.00
Down Payment: $1,575.00
Loan Amount: $43,425.00
Loan Points: $0.00
Loan Fees: $0.00
Amortized Over: 30 years
Loan Interest Rate: 4.00%
Monthly P&I: $207.32
Total Cash Needed
By Borrower:
$14,575.00
Monthly Income:
$1,100.00
Monthly Expenses:
$765.98
Monthly Cashflow:
$334.02
Pro Forma Cap Rate:
11.20%
NOI:
$6,496.00
Total Cash Needed:
$14,575.00
Cash on Cash ROI:
27.50%
Purchase Cap Rate:
14.44%
Total operating expenses: $558.67
Mortgage expenses: $207.32
Vacancy: $110.00 Repairs: $22.00
CapEx: $55.00 Water: $75.00
Insurance: $75.00 Management: $55.00
P&I: $207.32 Property Taxes: $166.67

Financial Info

Income-Expense Ratio (2% Rule):
1.90%

Total Initial Equity:
$1,575.00

Gross Rent Multiplier:
3.41

Debt Coverage Ratio:
2.61%

Analysis Over Time Show Assumptions

Year 1 Year 2 Year 3 Year 4 Year 10 Year 20 Year 30
Total Annual Income $13,200.00 $13,464.00 $13,733.28 $14,007.95 $15,775.22 $19,229.91 $23,441.15
Total Annual Expenses
Operating Expenses
Mortgage Payment
$9,191.81
$6,704.00
$2,487.81
$9,325.89
$6,838.08
$2,487.81
$9,462.65
$6,974.84
$2,487.81
$9,602.15
$7,114.34
$2,487.81
$10,499.71
$8,011.90
$2,487.81
$12,254.27
$9,766.46
$2,487.81
$11,905.26
$11,905.26
Total Annual Cashflow $4,008.19 $4,138.11 $4,270.63 $4,405.80 $5,275.51 $6,975.63 $11,535.89
Cash on Cash ROI 27.50% 28.39% 29.30% 30.23% 36.20% 47.86% 79.15%
Property Value $45,900.00 $46,818.00 $47,754.36 $48,709.45 $54,854.75 $66,867.63 $81,511.27
Equity $3,115.68 $4,739.91 $6,418.64 $8,154.07 $19,895.12 $45,901.92 $81,511.27
Loan Balance $42,784.32 $42,078.09 $41,335.72 $40,555.38 $34,959.63 $20,965.72

Income, Expenses and Cashflow
Income
Expenses
Cash Flow
Loan Balance, Value and Equity
Equity
Loan Payoff
Property Value

How are you buying with less than 5% down and 4% interest? NOO generally requires 20% down on SF and 25% on MF (2 - 4 units) and you'll likely pay a minimum of 4.25 - 4.75% interest.

Your formatting looks bad up top... seems like the enters got messed up in a copy and paste.  $1,100 rent against $45,000 purchase price is pretty good... that said, we can't analyze your expenses as you don't have them outlined.  They appear to be inline with 50% before P&I which is a solid sign... as long as you didn't leave anything out!

Also, your ARV looks terrible... why would you buy at the ARV when it needs $10,000 of repairs?

Originally posted by @Nathan Emmert :

Also, your ARV looks terrible... why would you buy at the ARV when it needs $10,000 of repairs?

Agreed if the ARV is $45K you should be trying to buy at about 1/2 that with 10K in repairs. At the very most you should be able to get the repairs deducted from the purchase price.

Is this owner financing?  You don't want to pay 55K for a 45K property just because the loan terms are good.

thanks nathan, taxes are $1800 a year and water is around $50 a month. i will be living in half but paying rent. the loan is an fha and will have to live in it for 1 year. i used 5% for property management 10% vacancy 5% capex  im not sure what to put in for general numbers  and the 10,000 is estimated house will need to be painted soon and figured if anything small comes up. as i said this is my first analysis 

i believe the house is worth between 50-60. i see that you cant guess at numbers when you input them. sorry guys

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