I am looking to buy my first investment property in Columbus, OH and I have made this model to help do so. The way this model is set up, a deal can quickly be analyzed by inserting values on the 'Inputs' tab. The rest of the tabs in the spreadsheet are calculations I have made that reference back to the inputs tab. I know there may be some flaws with this model so if you analyze it and see issues please feel free to offer feedback as that was the point of posting it on BP...as well as using the model if you find it to be valuable. Any feedback is highly appreciated!
- This deal is set up for a househack with 3.5% down as I plan the live in it for one year and then rent out that unit
- I believe any investment should be considered using the Net Present Value approach which is why all of the tabs lead up to a statement of cashflows and then a NPV calculation
- Closing costs, expenses, insurance, income growth rate, expenses growth rate, appreciation, repair costs, and ARV are all estimates. I have not actually estimated repair costs which is why I put the $5K in repairs in the 'other' area. The rest of the inputs are from the MLS
- Because I would be using an FHA loan, I have set up the model so that I would theoretically live there for one year and another tenant would rent out that unit the first day of year two. I understand this isn't exactly realistic but that's why the monthly expenses and income change significantly starting Year 2
- Also, I would have intentions of keeping the property for at least 10 years (hence the 10 year cash flow statement.
Like I said, any feedback on the model itself or even the deal at hand is appreciated.
Thanks for everything BP community, you guys are awesome!
Also, how exactly do I create a hyperlink to the spreadsheet?
@Steven Duby Hello Steven, I am studying accounting and plan to invest in Columbus after college. While I do not have a ton of experience analyzing deals, I took a look at your spreadsheet and was impressed by it. It seems very in-depth and well thought out. I appreciate you sharing it.
Taking a look at the file now. Looks good man. How are you looking for properties now? Also inspection cost seem a little low. I am usually seeing inspectors charging 250- 300 depending on sq/ft of the home.
@Austin Steed thanks for the tip on the inspection costs. Those are the type of items I was unsure about. I am currently looking for properties via the MLS
I'm working on finding my first property as well and your spreadsheet seems to hit all the angles needed to make a strong analysis. Thanks for putting this out there for everyone to use. I will let you know if I run into anything that might be off.
Great spreadsheet, I think im going to use it myself. The only issue I see is that ARV can significantly increase if you do some minor repairs. You can't just add purchase cost plus repair cost. For example using the BRRR method you increase the value of the house.
Thanks for sharing. I was looking for something like this. Tell me if I am missing something, but I think there is an error in the IRR calculations. It does not account for the fact that you still have mortgage remaining when you sell in year 10, which needs to be subtracted from the cash flow. Hence the IRR is overestimated.