Renovated Fourplex - Four 2BD/1.5BA Townhomes
Arkansas
8bd • 6ba • Built: 1982
| Projected Income | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Projected Rent | $60,360 | $62,171 | $64,036 | $65,957 | $67,936 | $69,974 | $72,073 | $74,235 | $76,462 | $78,756 |
| Vacancy Losses | ($4,829) | ($4,974) | ($5,123) | ($5,277) | ($5,435) | ($5,598) | ($5,766) | ($5,939) | ($6,117) | ($6,300) |
| Operating Income | $55,531 | $57,197 | $58,913 | $60,680 | $62,501 | $64,376 | $66,307 | $68,296 | $70,345 | $72,456 |
| Estimated Expenses | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Property Taxes | ($4,500) | ($4,667) | ($4,839) | ($5,018) | ($5,204) | ($5,396) | ($5,596) | ($5,803) | ($6,018) | ($6,241) |
| Insurance | ($3,600) | ($3,733) | ($3,871) | ($4,015) | ($4,163) | ($4,317) | ($4,477) | ($4,643) | ($4,814) | ($4,992) |
| Management Fees | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Leasing/Advertising Fees | ($2) | ($2) | ($2) | ($2) | ($2) | ($2) | ($2) | ($3) | ($3) | ($3) |
| Association Fees | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Maintenance | ($3,018) | ($3,130) | ($3,245) | ($3,366) | ($3,490) | ($3,619) | ($3,753) | ($3,892) | ($4,036) | ($4,185) |
| Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Operating Expenses | ($11,120) | ($11,531) | ($11,958) | ($12,401) | ($12,859) | ($13,335) | ($13,829) | ($14,340) | ($14,871) | ($15,421) |
| Income Analysis | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Net Operating Income | $44,411 | $45,666 | $46,955 | $48,280 | $49,641 | $51,041 | $52,479 | $53,956 | $55,474 | $57,035 |
| - Mortgage Payments | ($34,132) | ($34,132) | ($34,132) | ($34,132) | ($34,132) | ($34,132) | ($34,132) | ($34,132) | ($34,132) | ($34,132) |
| = Cash Flow | $10,279 | $11,534 | $12,823 | $14,148 | $15,510 | $16,909 | $18,347 | $19,824 | $21,343 | $22,903 |
| + Principal Reduction | $5,030 | $5,367 | $5,726 | $6,110 | $6,519 | $6,955 | $7,421 | $7,918 | $8,448 | $9,014 |
| + Appreciation | $30,000 | $31,500 | $33,075 | $34,729 | $36,465 | $38,288 | $40,203 | $42,213 | $44,324 | $46,540 |
| = Gross Equity Income | $45,309 | $48,401 | $51,624 | $54,986 | $58,494 | $62,153 | $65,971 | $69,956 | $74,115 | $78,457 |
| Capitalization Rate | 7.0% | 6.9% | 6.8% | 6.6% | 6.5% | 6.3% | 6.2% | 6.1% | 6.0% | 5.8% |
| Cash on Cash Return | 6.5% | 7.3% | 8.1% | 8.9% | 9.8% | 10.6% | 11.5% | 12.5% | 13.4% | 14.4% |
| Return on Equity | 24.5% | 21.8% | 19.8% | 18.2% | 17.0% | 15.9% | 15.1% | 14.3% | 13.7% | 13.2% |
| Loan Analysis | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Market Value | $630,000 | $661,500 | $694,575 | $729,304 | $765,769 | $804,057 | $844,260 | $886,473 | $930,797 | $977,337 |
| - Loan Balance | ($444,970) | ($439,604) | ($433,877) | ($427,768) | ($421,249) | ($414,294) | ($406,873) | ($398,955) | ($390,506) | ($381,492) |
| = Equity | $185,030 | $221,897 | $260,698 | $301,536 | $344,520 | $389,764 | $437,388 | $487,519 | $540,291 | $595,845 |
| Loan-to-Value Ratio | 70.6% | 66.5% | 62.5% | 58.7% | 55.0% | 51.5% | 48.2% | 45.0% | 42.0% | 39.0% |
| Potential Cash-Out Refi | $122,030 | $155,747 | $191,240 | $228,606 | $267,943 | $309,358 | $352,962 | $398,871 | $447,211 | $498,111 |
| Sale Analysis | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Equity | $185,030 | $221,897 | $260,698 | $301,536 | $344,520 | $389,764 | $437,388 | $487,519 | $540,291 | $595,845 |
| - Closing Costs | ($44,100) | ($46,305) | ($48,620) | ($51,051) | ($53,604) | ($56,284) | ($59,098) | ($62,053) | ($65,156) | ($68,414) |
| = Proceeds After Sale | $140,930 | $175,592 | $212,077 | $250,485 | $290,916 | $333,480 | $378,289 | $425,466 | $475,135 | $527,431 |
| + Cumulative Cash Flow | $10,279 | $21,813 | $34,637 | $48,785 | $64,295 | $81,204 | $99,550 | $119,375 | $140,718 | $163,620 |
| - Approximate Cash Invested | ($159,000) | ($159,000) | ($159,000) | ($159,000) | ($159,000) | ($159,000) | ($159,000) | ($159,000) | ($159,000) | ($159,000) |
| = Net Profit | ($7,791) | $38,405 | $87,714 | $140,269 | $196,211 | $255,683 | $318,840 | $385,840 | $456,853 | $532,052 |
| Internal Rate of Return | -4.9% | 11.8% | 16.6% | 18.5% | 19.1% | 19.3% | 19.3% | 19.1% | 18.9% | 18.7% |
| Return on Investment | -4.9% | 24.2% | 55.2% | 88.2% | 123.4% | 160.8% | 200.5% | 242.7% | 287.3% | 334.6% |
*Information is not guaranteed and investors should do their own research, get professional advice and conduct due diligence prior to investing.