Maxable is doing its 6th annual Best ADU of The Year competition.

.: Quote from @Caleb Wolf: Hello bigger pockets members.

The webinar for the property Wolf Run was held today.

The Lender’s DCR – Theoretical and OptimisticLenders calculate Debt Coverage Ratio (DCR) by dividing Net Operating Income (NOI) by Annual Debt Service.Their version of NOI is usually based on: Market rent (sometimes even above actual rent) Standard vacancy allowance (often 5%) Limited expenses — typically taxes, insurance, and maybe management at 8–10%That’s it.

If your HELOC is at an 8% rate and you lend the money at 11% plus a few points per year, that’s a 5% annualized spread.

The original oil and gas investment proforma projected the following: a $75,000 W-2 tax deduction, a 3x return on investment (approximately 350% over 3–5 years), and an 8–12% annualized return (ARR) paid monthly.While the tax deduction did come through as expected, the actual monthly returns have been significantly lower.

I submitted my normal annual increase.

I’m considering a 1031 exchange and would like feedback from investors who have experience with mobile home parks, particularly smaller, park-owned operations.Current Property (Selling):Duplex purchased in 2021 for approximately $145,000; estimated current value around $210,000\Loan balance: about $90,000Gross rent: $2,400 per monthNOI: approximately $16,000–$18,000 annuallyCash flow after mortgage: around $750–800 per monthLow management requirements and stable tenantsReplacement Property (Under Consideration):Seven-unit mobile home parkAsking price: $395,000Rent: $750 per unit plus $40 for water (total $5,530 per month; $66,360 annually)100% occupied with long-term tenants, several in place four to five yearsAll homes are park-owned, purchased between 2016–2018 with metal roofs and Hardie sidingOwner pays water and sewer (aerobic septic); tenants pay electric and trashMaintenance handled by one individual for $400 per month using personal equipmentGravel road, well maintained; potential to add one or two additional homesMy Pro Forma:Vacancy: 5%Expenses: approximately 40% of effective gross income (includes water, insurance, taxes, maintenance, mowing, etc.)Estimated NOI: $37,800Financing assumption: $255,000 loan at 8% interest, 25-year termAnnual debt service: approximately $23,574Projected cash flow: about $14,250 annually ($1,188 per month)Cap rate: approximately 9.6%Cash-on-cash return: around 10% on $140,000 downDSCR: 1.6 (strong coverage)If the price can be negotiated to the $360,000–$370,000 range, the cash-on-cash return improves to roughly 11–12%.Pros:Consistent, well-maintained units with matching exteriors.

Farmers, State Farm, etc.) increase their rates quite a bit annually and wanted to hear what others' experiences have been.

CategoryAmountPurchase Price$550,000Rehab Budget$185,000Closing Costs$17,000Total Project Cost$752,000Effective Gross Income$168,120Operating Expenses($60,000)NOI$108,120Debt Service($48,852)Annual Cash Flow$59,268Monthly Cash Flow$4,939Cap Rate (on cost)14.4%DSCR2.21Cash-on-Cash Return31.8% Hey @Chad Emerson, welcome to the BP Forum!