Purchase Price $174,900.00
Down Payment % 25.00%
Down Payment Amount $43,725.00
Interest Rate 4.500% (not yet known)
Loan amount $131,175.00
Full Rent Amount $2,945
Yearly Property Taxes $3,276.00
Expected Vacancy % 2.8%
Management Fees (% of Rent) 10%
Vacancy $82.46
Taxes (actual) $273.00
Insurance (quoted) $125.00
Mortgage $664.64
Future Management (10%) $294.50
Cap X $168.06
Trash $25.00
Water/sewer/gas/electric/heat: $240.00
Lawn/Snow Removal $150.00
Expense totals $2,022.66
Immediate Repair Estimate $50,000.00
Closing Cost Estimate $4,000.00
Total (Down Payment + Short Term Exp) $97,725.00
Water Heater $32.14
Roof $62.50
Kitchen, Bath Fixtures (faucets, tubs, toilets,etc) $8.75
Internal Paint $9.38
Flooring $31.25
Refrigerator $15.38
Range $8.65
Cap X totals $168.06
Cashflow: $922/month
Cash return: 11.3%
Estimated value of property with all the updates, plus increased rent: $250-$275k
Equity capture: $25-$50k
Other important factors:
1. The units are currently under market rent. Realistically they should fetch $3500/month due to 2 major universities in the area. This would boost the cashflow by $500 and bring the annual return to 16.3%
2. The house definitely needs a new roof, though I'm not sure if it needs all new plywood + shingles, or just the shingles. The house is 2600 sq. ft. altogether.
3. It also would benefit from being hooked up to public sewer. But I have no idea how much this would cost. The last sale fell through during the inspection because the septic was questionable. However, the owner said if it didn't sell as is, he'd have the roof done and public sewer connected, then raise the price to $225k
4. It needs all new windows, which I'm estimating would cost about $11k for windows + installation
I'm estimating $15k for the roof, $10k for the sewer, $11k for windows, and $10k for cosmetic updates. Plus another 10% for any unexpected costs. Does anyone know how to ballpark estimate the cost of a roof and a sewer hookup?