All Forum Posts by: Evan Peissig

I just got an accepted offer on a first deal. It is a 10 unit apartment complex (8x1BR/1BA 2x 2BR/1BA) and a Duplex (3BR/1BA and 1BR/1BA). Below is the spreadsheet analysis. Would appreciate any comments on the deal! I am financing with equity in another property so it is essentially 100% financing. I am not yet sure the terms of financing at this point, but likely fixed for 5 years around 5% then variable.


Prepared By			Key Investment Criteria
Client Name			Max Offer	$ 425,000
Property Address			Down Payment	$ -
Number of Units	12			Cash Flow (Per 100K)	$88.30
List Price	$ 425,000	% of List Price		Cash Flow (Monthly)	$ 375.29
Offer Price	$ 425,000	100%		Total Cash In	$ 10,000.00
ARV/Appraised Value	$ 450,000			Debt Service CR	1.16	Pref >1.2
Discount (%,$)	0%	$ -		Debt Yield Ratio	7.65%	Pref >10%
Purchase Price (Max Offer Price)	$ 425,000			Cap Rate	7.47%	Pref >8%
Percent Down	0%			LTV	1.00	Pref <.75
Down Payment Amount	$ -			Rent/Price Ratio	1.35%	Pref 1.25%
Amount Financed	$ 425,000			COC ROI Year 1	218.0%
Interest Rate	5.20%			(Exp+Int)/Income	84%
Costs of Repairs	$ 5,000			Gross Rent Multiplier	6.3	Pref <9
Closing Costs	$ 5,000			COC Return	45.0%	Pref >10%
Total Cost	$ 435,000			Break Even Ratio	93%	Pref <85%
Length of Mortgage (Years)	30			Expense Ratio	53%	~50%
Payment	Monthly	Annual		ARV-Total Cost	$ 15,000
Monthly Mortgage Payment	$2,333.72	$ 28,004.65		% Investment of ARV	96%	Pref <75%
		10 year Return	65%	$284,164
Rental Income	Monthly	Annual		15 Year Return	113%	$490,037
Unit A (10 unit Apt)	$ 4,550.00	$ 54,600.00		20 Year Return	172%	$748,269
Unit B (Duplex)	$ 1,250.00	$ 15,000.00
Unit C	$ -	$ -		DSCR greater than 1.45		1.16
Unit D	$ -	$ -		Standardized Cashflow >180		$88.30
Gross Rental Income	$ 5,800.00	$ 69,600.00		LTV less than .76		1.00
Vacancy Rate	8%			ROI year 1 greater than 20%		218.0%
Net Rental Income	$ 5,336.00	$ 64,032.00		Expense ratio between 45 and 55%		53%
		Positive initial equity		$ 15,000
Expenses	Monthly	Annual		15 year return greater than 115%		113%
Property Management Fees	$ 320.16	$ 3,841.92	6.0%	Total Cash In Less than 50K	$ 10,000
Leasing Costs	$ -	$ -	0%	DYR greater than 9%		7.65%
Maintenance Reserve	$ 750.00	$ 9,000.00
Utilities	$ 375.00	$ 4,500
PropertyTaxes	$ 640.17	$ 7,682.00
Insurance	$ 325.00	$ 3,900.00
Other (Snow, Lawn Care, Trash, etc)	$ 216.67	$ 2,600.00
Total Expenses	$ 2,626.99	$ 31,523.92

Net Operating Income	$ 2,709.01	$ 32,508.08

Mortgage Payment	$ 2,333.72	$ 28,004.65
Total Cash In (Downpayment + Repairs)	$ 10,000.00
Net Cash Flow	$ 375.29	$ 4,503.43

Investment Analysis
Appreciation Rate (20 YR AVG = 4.4%)	2.5%
Rent Appreciation (20 YR AVG = 3.1%)	2.5%
Cost to Sell Property	0.0%

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