All Forum Posts by: Lynn Bown

I may be off since there is so many variables.  I show this as a good long term investment making 14% yearly by the 10th year.  But initially at a loss with you putting down 20%.  Since im making several assumptions in my numbers Here they are so you can play with them.  If you find any corrections I should make please post.

this doesnt render the spreadsheet exactly as it should look but it is OK and you can edit things.  It works best in Chrome or Firefox.

http://tinyurl.com/z7u36l8

Hope this helps.

Stocks can be compared to this house, but if you're calculating long term you can be negative in cash flow monthly but positive longer term in equity.

My spreadsheet figures all these things including appreciation and loan paydown and calculates:

1. Cash on Cash ROI

2. Raw Cap rate ROI

3. 1 year ROI with equity net Cap Rate

4. 2 year ROI with equity net Cap Rate

5. 10 year ROI with equity net Cap Rate

Only then can you compare properly to the stock market for yearly return.

@Mike H. is right and a good rule of thumb. And I love that Warren buffet quote. The rules of thumb vary by area. As a Landlord, investor, and Realtor that consults for investors I take great efforts to know the numbers of MY area and use several spreadsheets to analyse each "Fast Ball" or deal in minutes as a result of preparation. Around here you can get away with around 80% - 85% LTV but the major factor is the ratio of rent/purchase price. In areas where that is not high on the rent end it is harder to make that work. Looking for sections of your area where rent is higher not in general but compared to purchase price and documenting it is the key to knowing where to buy&hold. then take the capex numbers and apply your area costs and the other factors too. then you have the research done and are ready to evaluate a property in minutes.

WOW on the insurance! out hear we get raped as landlords then.
Repairs are misc repairs that will come up and represent 5% of the monthly on national average.
Capex are structural as below and divided by the average years of each since it is not whether it goes but when it goes.

It is a small positive cash flow of 1100 per year so check on average appreciation of similar properties over the past 4 years to determine if it is worth the long term hold.

Also insurancce for .65% seems very low is this property insurance or Landlord Insurance?

Just noticed you are doing the Property MNGMNT.  fixed numbers...

I use my own spreadsheet so I can adjust according to Misc changes. Based on the numbers you provided I count this property as a -3800 yearly ROI. Walk.

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Charlotte & Sarasota Counties

Welcome LaShondra to BP.  Im in North Port Fl.

If you have any questions or need anything feel free to ask.

Lynn

I specialize in North Port, Port charlotte, and Punta Gorda. 200k can get you a very nice SFR in this area. as you research feel free to call me on any property and I will advise you on the neighborhood and potential. Let me know your long/short term goals for the properties and I can help you find the right deals.