Author Topic: My cash flow diagrams are wonky. I can't accurately predict anything  (Read 1721 times)

Sulame66

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Below is my amortization and random scribblings on an investment property

200k property, 40k down, 4.25% interest, 30 years fixed, 160k mortgage, all in expenses a month including mortgage, insurance, taxes, etc. is 1,400, rent is 1,600. This is not factoring in random fixes and what not because I don't see how that impacts the calculation. It's in another bucket of expenses but separate from this cash flow.

I then (probably screwed up here) assumed that those liabilities go up 2% a year, while rent goes up 4%. I initially thought the only thing that mattered was the differential of 2%, but that's not accurate. If we instead did 4 and 6, the #s would be almost 50% higher. Probably just a simple formula of 4/2 = 2 and 6/4 = 1.5 so an inverse gain of 50%, I don't know and I'm too tired to figure it out.

Point is, it doesn't make sense. There is NO WAY that in 30 years an initial investment of 40k is now putting out $2,740 a month, and then the very next month the mortgage is eliminated and it shoots up to $3,500 a month FOREVER.

..... right?

EDIT: Also realized that I have the mortgage included as an expense in that category, so it's growing at the 2%, but the mortgage is static. That means the growth is even more alarming

month   balance   interest   payment   new balance         Total payments   Total Rent   Gain
1   160,000   567   787.11   159,780         1400   1600   200
2   159,780   566   787.11   159,558         1402.33   1605.333333   203
3   159,558   565   787.11   159,336         1404.67   1610.684444   206.0138889
4   159,336   564   787.11   159,114         1407.01   1616.053393   209.0417194
5   159,114   564   787.11   158,890         1409.36   1621.440237   212.0835446
6   158,890   563   787.11   158,666         1411.71   1626.845038   215.1394176
7   158,666   562   787.11   158,440         1414.06   1632.267855   218.2093917
8   158,440   561   787.11   158,214         1416.42   1637.708748   221.2935204
9   158,214   560   787.11   157,988         1418.78   1643.167777   224.3918576
10   157,988   560   787.11   157,760         1421.14   1648.645003   227.5044569
11   157,760   559   787.11   157,532         1423.51   1654.140486   230.6313727
12   157,532   558   787.11   157,303         1425.88   1659.654288   233.7726591
13   157,303   557   787.11   157,073         1428.26   1665.186469   236.9283707
14   157,073   556   787.11   156,842         1430.64   1670.73709   240.0985621
15   156,842   555   787.11   156,610         1433.02   1676.306214   243.2832882
16   156,610   555   787.11   156,378         1435.41   1681.893901   246.482604
17   156,378   554   787.11   156,144         1437.80   1687.500214   249.6965649
18   156,144   553   787.11   155,910         1440.20   1693.125215   252.9252262
19   155,910   552   787.11   155,675         1442.60   1698.768966   256.1686436
20   155,675   551   787.11   155,440         1445.00   1704.431529   259.4268729
21   155,440   551   787.11   155,203         1447.41   1710.112967   262.6999703
22   155,203   550   787.11   154,966         1449.83   1715.813344   265.9879918
23   154,966   549   787.11   154,727         1452.24   1721.532722   269.2909941
24   154,727   548   787.11   154,488         1454.66   1727.271164   272.6090336
25   154,488   547   787.11   154,248         1457.09   1733.028735   275.9421672
26   154,248   546   787.11   154,007         1459.52   1738.805497   279.2904521
27   154,007   545   787.11   153,766         1461.95   1744.601515   282.6539453
28   153,766   545   787.11   153,523         1464.38   1750.416854   286.0327044
29   153,523   544   787.11   153,280         1466.82   1756.251577   289.426787
30   153,280   543   787.11   153,036         1469.27   1762.105749   292.836251
31   153,036   542   787.11   152,790         1471.72   1767.979434   296.2611543
32   152,790   541   787.11   152,544         1474.17   1773.872699   299.7015553
33   152,544   540   787.11   152,298         1476.63   1779.785608   303.1575124
34   152,298   539   787.11   152,050         1479.09   1785.718227   306.6290842
35   152,050   539   787.11   151,801         1481.55   1791.670621   310.1163298
36   151,801   538   787.11   151,552         1484.02   1797.642856   313.619308
37   151,552   537   787.11   151,301         1486.50   1803.634999   317.1380783
38   151,301   536   787.11   151,050         1488.97   1809.647116   320.6727001
39   151,050   535   787.11   150,798         1491.46   1815.679273   324.2232331
40   150,798   534   787.11   150,545         1493.94   1821.731537   327.7897373
41   150,545   533   787.11   150,291         1496.43   1827.803976   331.3722727
42   150,291   532   787.11   150,036         1498.93   1833.896656   334.9708998
43   150,036   531   787.11   149,781         1501.42   1840.009644   338.5856791
44   149,781   530   787.11   149,524         1503.93   1846.14301   342.2166713
45   149,524   530   787.11   149,266         1506.43   1852.29682   345.8639374
46   149,266   529   787.11   149,008         1508.94   1858.471143   349.5275387
47   149,008   528   787.11   148,749         1511.46   1864.666046   353.2075365
48   148,749   527   787.11   148,488         1513.98   1870.8816   356.9039925
49   148,488   526   787.11   148,227         1516.50   1877.117872   360.6169684
50   148,227   525   787.11   147,965         1519.03   1883.374932   364.3465265
51   147,965   524   787.11   147,702         1521.56   1889.652848   368.0927289
52   147,702   523   787.11   147,438         1524.10   1895.951691   371.8556382
53   147,438   522   787.11   147,173         1526.64   1902.27153   375.6353171
54   147,173   521   787.11   146,907         1529.18   1908.612435   379.4318285
55   146,907   520   787.11   146,640         1531.73   1914.974476   383.2452356
56   146,640   519   787.11   146,372         1534.28   1921.357725   387.0756018
57   146,372   518   787.11   146,104         1536.84   1927.76225   390.9229907
58   146,104   517   787.11   145,834         1539.40   1934.188124   394.7874661
59   145,834   516   787.11   145,563         1541.97   1940.635418   398.6690921
60   145,563   516   787.11   145,292         1544.54   1947.104203   402.5679329
61   145,292   515   787.11   145,019         1547.11   1953.59455   406.4840532
62   145,019   514   787.11   144,746         1549.69   1960.106532   410.4175175
63   144,746   513   787.11   144,471         1552.27   1966.640221   414.3683909
64   144,471   512   787.11   144,196         1554.86   1973.195688   418.3367386
65   144,196   511   787.11   143,920         1557.45   1979.773007   422.322626
66   143,920   510   787.11   143,642         1560.05   1986.37225   426.3261187
67   143,642   509   787.11   143,364         1562.65   1992.993491   430.3472827
68   143,364   508   787.11   143,084         1565.25   1999.636803   434.3861839
69   143,084   507   787.11   142,804         1567.86   2006.302259   438.4428889
70   142,804   506   787.11   142,523         1570.47   2012.989933   442.5174642
71   142,523   505   787.11   142,240         1573.09   2019.699899   446.6099765
72   142,240   504   787.11   141,957         1575.71   2026.432232   450.720493
73   141,957   503   787.11   141,673         1578.34   2033.187007   454.8490808
74   141,673   502   787.11   141,387         1580.97   2039.964297   458.9958076
75   141,387   501   787.11   141,101         1583.60   2046.764178   463.1607411
76   141,101   500   787.11   140,814         1586.24   2053.586725   467.3439493
77   140,814   499   787.11   140,525         1588.89   2060.432014   471.5455005
78   140,525   498   787.11   140,236         1591.53   2067.300121   475.765463
79   140,236   497   787.11   139,945         1594.19   2074.191121   480.0039056
80   139,945   496   787.11   139,654         1596.84   2081.105091   484.2608973
81   139,654   495   787.11   139,361         1599.51   2088.042108   488.5365073
82   139,361   494   787.11   139,068         1602.17   2095.002249   492.830805
83   139,068   493   787.11   138,773         1604.84   2101.98559   497.1438601
84   138,773   491   787.11   138,478         1607.52   2108.992208   501.4757425
85   138,478   490   787.11   138,181         1610.20   2116.022182   505.8265224
86   138,181   489   787.11   137,883         1612.88   2123.075589   510.1962703
87   137,883   488   787.11   137,584         1615.57   2130.152508   514.5850567
88   137,584   487   787.11   137,285         1618.26   2137.253016   518.9929527
89   137,285   486   787.11   136,984         1620.96   2144.377193   523.4200293
90   136,984   485   787.11   136,682         1623.66   2151.525117   527.866358
91   136,682   484   787.11   136,379         1626.36   2158.696868   532.3320104
92   136,379   483   787.11   136,075         1629.08   2165.892524   536.8170586
93   136,075   482   787.11   135,769         1631.79   2173.112166   541.3215745
94   135,769   481   787.11   135,463         1634.51   2180.355873   545.8456308
95   135,463   480   787.11   135,156         1637.23   2187.623726   550.3892999
96   135,156   479   787.11   134,847         1639.96   2194.915805   554.952655
97   134,847   478   787.11   134,538         1642.70   2202.232191   559.5357691
98   134,538   476   787.11   134,227         1645.43   2209.572965   564.1387157
99   134,227   475   787.11   133,916         1648.18   2216.938208   568.7615685
100   133,916   474   787.11   133,603         1650.92   2224.328002   573.4044014
101   133,603   473   787.11   133,289         1653.68   2231.742429   578.0672888
102   133,289   472   787.11   132,974         1656.43   2239.18157   582.750305
103   132,974   471   787.11   132,658         1659.19   2246.645509   587.4535248
104   132,658   470   787.11   132,340         1661.96   2254.134327   592.1770232
105   132,340   469   787.11   132,022         1664.73   2261.648108   596.9208754
106   132,022   468   787.11   131,702         1667.50   2269.186935   601.6851571
107   131,702   466   787.11   131,382         1670.28   2276.750892   606.4699439
108   131,382   465   787.11   131,060         1673.06   2284.340061   611.2753119
109   131,060   464   787.11   130,737         1675.85   2291.954528   616.1013376
110   130,737   463   787.11   130,413         1678.65   2299.594377   620.9480973
111   130,413   462   787.11   130,088         1681.44   2307.259691   625.8156681
112   130,088   461   787.11   129,761         1684.25   2314.950557   630.7041271
113   129,761   460   787.11   129,434         1687.05   2322.667059   635.6135515
114   129,434   458   787.11   129,105         1689.87   2330.409282   640.5440192
115   129,105   457   787.11   128,775         1692.68   2338.177313   645.495608
116   128,775   456   787.11   128,444         1695.50   2345.971237   650.4683962
117   128,444   455   787.11   128,112         1698.33   2353.791142   655.4624623
118   128,112   454   787.11   127,779         1701.16   2361.637112   660.477885
119   127,779   453   787.11   127,444         1703.99   2369.509236   665.5147433
120   127,444   451   787.11   127,108         1706.83   2377.4076   670.5731166
121   127,108   450   787.11   126,771         1709.68   2385.332292   675.6530845
122   126,771   449   787.11   126,433         1712.53   2393.2834   680.7547268
123   126,433   448   787.11   126,094         1715.38   2401.261011   685.8781236
124   126,094   447   787.11   125,753         1718.24   2409.265214   691.0233555
125   125,753   445   787.11   125,412         1721.11   2417.296098   696.1905031
126   125,412   444   787.11   125,069         1723.97   2425.353752   701.3796475
127   125,069   443   787.11   124,725         1726.85   2433.438264   706.5908698
128   124,725   442   787.11   124,379         1729.73   2441.549725   711.8242517
129   124,379   441   787.11   124,033         1732.61   2449.688224   717.079875
130   124,033   439   787.11   123,685         1735.50   2457.853852   722.3578218
131   123,685   438   787.11   123,336         1738.39   2466.046698   727.6581746
132   123,336   437   787.11   122,985         1741.29   2474.266854   732.9810161
133   122,985   436   787.11   122,634         1744.19   2482.51441   738.3264292
134   122,634   434   787.11   122,281         1747.09   2490.789458   743.6944973
135   122,281   433   787.11   121,927         1750.01   2499.092089   749.0853038
136   121,927   432   787.11   121,572         1752.92   2507.422396   754.4989328
137   121,572   431   787.11   121,215         1755.85   2515.780471   759.9354684
138   121,215   429   787.11   120,857         1758.77   2524.166406   765.3949949
139   120,857   428   787.11   120,498         1761.70   2532.580294   770.8775973
140   120,498   427   787.11   120,138         1764.64   2541.022228   776.3833604
141   120,138   425   787.11   119,776         1767.58   2549.492302   781.9123697
142   119,776   424   787.11   119,413         1770.53   2557.99061   787.4647109
143   119,413   423   787.11   119,049         1773.48   2566.517245   793.0404697
144   119,049   422   787.11   118,684         1776.43   2575.072303   798.6397326
145   118,684   420   787.11   118,317         1779.39   2583.655877   804.262586
146   118,317   419   787.11   117,949         1782.36   2592.268063   809.9091168
147   117,949   418   787.11   117,580         1785.33   2600.908957   815.5794121
148   117,580   416   787.11   117,209         1788.31   2609.578654   821.2735593
149   117,209   415   787.11   116,837         1791.29   2618.277249   826.9916464
150   116,837   414   787.11   116,464         1794.27   2627.00484   832.7337612
151   116,464   412   787.11   116,089         1797.26   2635.761523   838.4999922
152   116,089   411   787.11   115,713         1800.26   2644.547394   844.290428
153   115,713   410   787.11   115,336         1803.26   2653.362552   850.1051578
154   115,336   408   787.11   114,957         1806.26   2662.207094   855.9442706
155   114,957   407   787.11   114,577         1809.27   2671.081118   861.8078562
156   114,577   406   787.11   114,196         1812.29   2679.984722   867.6960045
157   114,196   404   787.11   113,813         1815.31   2688.918004   873.6088057
158   113,813   403   787.11   113,429         1818.33   2697.881064   879.5463504
159   113,429   402   787.11   113,044         1821.37   2706.874001   885.5087294
160   113,044   400   787.11   112,657         1824.40   2715.896914   891.496034
161   112,657   399   787.11   112,269         1827.44   2724.949904   897.5083555
162   112,269   398   787.11   111,879         1830.49   2734.03307   903.545786
163   111,879   396   787.11   111,488         1833.54   2743.146514   909.6084174
164   111,488   395   787.11   111,096         1836.59   2752.290336   915.6963423
165   111,096   393   787.11   110,703         1839.65   2761.464637   921.8096534
166   110,703   392   787.11   110,307         1842.72   2770.669519   927.9484439
167   110,307   391   787.11   109,911         1845.79   2779.905084   934.1128072
168   109,911   389   787.11   109,513         1848.87   2789.171434   940.302837
169   109,513   388   787.11   109,114         1851.95   2798.468672   946.5186274
170   109,114   386   787.11   108,713         1855.04   2807.796901   952.7602729
171   108,713   385   787.11   108,311         1858.13   2817.156224   959.0278682
172   108,311   384   787.11   107,908         1861.23   2826.546745   965.3215084
173   107,908   382   787.11   107,503         1864.33   2835.968567   971.6412888
174   107,503   381   787.11   107,096         1867.43   2845.421796   977.9873052
175   107,096   379   787.11   106,689         1870.55   2854.906535   984.3596537
176   106,689   378   787.11   106,279         1873.66   2864.42289   990.7584307
177   106,279   376   787.11   105,869         1876.79   2873.970967   997.1837329
178   105,869   375   787.11   105,456         1879.92   2883.55087   1003.635657
179   105,456   373   787.11   105,043         1883.05   2893.162706   1010.114302
180   105,043   372   787.11   104,628         1886.19   2902.806582   1016.619763
181   104,628   371   787.11   104,211         1889.33   2912.482604   1023.152141
182   104,211   369   787.11   103,793         1892.48   2922.190879   1029.711532
183   103,793   368   787.11   103,374         1895.63   2931.931515   1036.298036
184   103,374   366   787.11   102,953         1898.79   2941.70462   1042.911752
185   102,953   365   787.11   102,530         1901.96   2951.510303   1049.552779
186   102,530   363   787.11   102,106         1905.13   2961.34867   1056.221217
187   102,106   362   787.11   101,681         1908.30   2971.219832   1062.917167
188   101,681   360   787.11   101,254         1911.48   2981.123899   1069.640729
189   101,254   359   787.11   100,825         1914.67   2991.060978   1076.392003
190   100,825   357   787.11   100,395         1917.86   3001.031181   1083.171092
191   100,395   356   787.11   99,964         1921.06   3011.034619   1089.978095
192   99,964   354   787.11   99,531         1924.26   3021.071401   1096.813117
193   99,531   353   787.11   99,096         1927.47   3031.141639   1103.676257
194   99,096   351   787.11   98,660         1930.68   3041.245444   1110.567621
195   98,660   349   787.11   98,222         1933.90   3051.382929   1117.487309
196   98,222   348   787.11   97,783         1937.12   3061.554206   1124.435426
197   97,783   346   787.11   97,342         1940.35   3071.759386   1131.412076
198   97,342   345   787.11   96,900         1943.58   3081.998584   1138.417361
199   96,900   343   787.11   96,456         1946.82   3092.271913   1145.451388
200   96,456   342   787.11   96,010         1950.07   3102.579486   1152.51426
201   96,010   340   787.11   95,563         1953.32   3112.921417   1159.606083
202   95,563   338   787.11   95,115         1956.57   3123.297822   1166.726962
203   95,115   337   787.11   94,664         1959.83   3133.708815   1173.877003
204   94,664   335   787.11   94,213         1963.10   3144.154511   1181.056313
205   94,213   334   787.11   93,759         1966.37   3154.635026   1188.264998
206   93,759   332   787.11   93,304         1969.65   3165.150476   1195.503165
207   93,304   330   787.11   92,847         1972.93   3175.700978   1202.770921
208   92,847   329   787.11   92,389         1976.22   3186.286648   1210.068374
209   92,389   327   787.11   91,929         1979.51   3196.907603   1217.395632
210   91,929   326   787.11   91,468         1982.81   3207.563962   1224.752804
211   91,468   324   787.11   91,005         1986.12   3218.255842   1232.139999
212   91,005   322   787.11   90,540         1989.43   3228.983361   1239.557325
213   90,540   321   787.11   90,073         1992.74   3239.746639   1247.004893
214   90,073   319   787.11   89,605         1996.06   3250.545794   1254.482812
215   89,605   317   787.11   89,135         1999.39   3261.380947   1261.991193
216   89,135   316   787.11   88,664         2002.72   3272.252217   1269.530147
217   88,664   314   787.11   88,191         2006.06   3283.159724   1277.099784
218   88,191   312   787.11   87,716         2009.40   3294.10359   1284.700217
219   87,716   311   787.11   87,240         2012.75   3305.083935   1292.331556
220   87,240   309   787.11   86,762         2016.11   3316.100882   1299.993915
221   86,762   307   787.11   86,282         2019.47   3327.154551   1307.687407
222   86,282   306   787.11   85,800         2022.83   3338.245067   1315.412143
223   85,800   304   787.11   85,317         2026.20   3349.37255   1323.168239
224   85,317   302   787.11   84,832         2029.58   3360.537125   1330.955807
225   84,832   300   787.11   84,345         2032.96   3371.738916   1338.774962
226   84,345   299   787.11   83,857         2036.35   3382.978045   1346.625818
227   83,857   297   787.11   83,367         2039.75   3394.254639   1354.508491
228   83,367   295   787.11   82,875         2043.15   3405.568821   1362.423096
229   82,875   294   787.11   82,381         2046.55   3416.920717   1370.36975
230   82,381   292   787.11   81,886         2049.96   3428.310453   1378.348567
231   81,886   290   787.11   81,389         2053.38   3439.738154   1386.359665
232   81,389   288   787.11   80,890         2056.80   3451.203948   1394.403162
233   80,890   286   787.11   80,389         2060.23   3462.707961   1402.479174
234   80,389   285   787.11   79,887         2063.66   3474.250321   1410.587819
235   79,887   283   787.11   79,383         2067.10   3485.831156   1418.729216
236   79,383   281   787.11   78,877         2070.55   3497.450593   1426.903483
237   78,877   279   787.11   78,369         2074.00   3509.108761   1435.11074
238   78,369   278   787.11   77,860         2077.45   3520.805791   1443.351106
239   77,860   276   787.11   77,348         2080.92   3532.54181   1451.6247
240   77,348   274   787.11   76,835         2084.39   3544.316949   1459.931645
241   76,835   272   787.11   76,320         2087.86   3556.131339   1468.272059
242   76,320   270   787.11   75,803         2091.34   3567.98511   1476.646065
243   75,803   268   787.11   75,285         2094.82   3579.878394   1485.053783
244   75,285   267   787.11   74,764         2098.32   3591.811322   1493.495337
245   74,764   265   787.11   74,242         2101.81   3603.784026   1501.970848
246   74,242   263   787.11   73,718         2105.32   3615.79664   1510.480439
247   73,718   261   787.11   73,192         2108.83   3627.849295   1519.024235
248   73,192   259   787.11   72,664         2112.34   3639.942126   1527.602357
249   72,664   257   787.11   72,134         2115.86   3652.075267   1536.214931
250   72,134   255   787.11   71,602         2119.39   3664.248851   1544.862082
251   71,602   254   787.11   71,069         2122.92   3676.463014   1553.543933
252   71,069   252   787.11   70,533         2126.46   3688.71789   1562.260611
253   70,533   250   787.11   69,996         2130.00   3701.013617   1571.012242
254   69,996   248   787.11   69,457         2133.55   3713.350329   1579.798952
255   69,457   246   787.11   68,916         2137.11   3725.728163   1588.620867
256   68,916   244   787.11   68,373         2140.67   3738.147257   1597.478116
257   68,373   242   787.11   67,828         2144.24   3750.607748   1606.370825
258   67,828   240   787.11   67,281         2147.81   3763.109774   1615.299122
259   67,281   238   787.11   66,732         2151.39   3775.653473   1624.263137
260   66,732   236   787.11   66,181         2154.98   3788.238985   1633.262998
261   66,181   234   787.11   65,629         2158.57   3800.866448   1642.298835
262   65,629   232   787.11   65,074         2162.17   3813.536003   1651.370777
263   65,074   230   787.11   64,517         2165.77   3826.247789   1660.478955
264   64,517   228   787.11   63,959         2169.38   3839.001949   1669.6235
265   63,959   227   787.11   63,398         2172.99   3851.798622   1678.804542
266   63,398   225   787.11   62,836         2176.62   3864.637951   1688.022214
267   62,836   223   787.11   62,271         2180.24   3877.520077   1697.276648
268   62,271   221   787.11   61,704         2183.88   3890.445144   1706.567975
269   61,704   219   787.11   61,136         2187.52   3903.413294   1715.896331
270   61,136   217   787.11   60,565         2191.16   3916.424672   1725.261847
271   60,565   215   787.11   59,993         2194.81   3929.479421   1734.664658
272   59,993   212   787.11   59,418         2198.47   3942.577686   1744.104898
273   59,418   210   787.11   58,841         2202.14   3955.719611   1753.582702
274   58,841   208   787.11   58,263         2205.81   3968.905343   1763.098206
275   58,263   206   787.11   57,682         2209.48   3982.135028   1772.651545
276   57,682   204   787.11   57,099         2213.17   3995.408811   1782.242856
277   57,099   202   787.11   56,514         2216.85   4008.726841   1791.872275
278   56,514   200   787.11   55,927         2220.55   4022.089264   1801.539941
279   55,927   198   787.11   55,338         2224.25   4035.496228   1811.245989
280   55,338   196   787.11   54,747         2227.96   4048.947882   1820.99056
281   54,747   194   787.11   54,154         2231.67   4062.444375   1830.77379
282   54,154   192   787.11   53,559         2235.39   4075.985856   1840.595821
283   53,559   190   787.11   52,961         2239.12   4089.572476   1850.45679
284   52,961   188   787.11   52,362         2242.85   4103.204384   1860.356839
285   52,362   185   787.11   51,760         2246.59   4116.881732   1870.296108
286   51,760   183   787.11   51,156         2250.33   4130.604671   1880.274737
287   51,156   181   787.11   50,550         2254.08   4144.373353   1890.29287
288   50,550   179   787.11   49,942         2257.84   4158.187931   1900.350647
289   49,942   177   787.11   49,332         2261.60   4172.048557   1910.448211
290   49,332   175   787.11   48,719         2265.37   4185.955386   1920.585706
291   48,719   173   787.11   48,105         2269.15   4199.90857   1930.763274
292   48,105   170   787.11   47,488         2272.93   4213.908266   1940.981061
293   47,488   168   787.11   46,869         2276.72   4227.954627   1951.239209
294   46,869   166   787.11   46,248         2280.51   4242.047809   1961.537866
295   46,248   164   787.11   45,625         2284.31   4256.187968   1971.877175
296   45,625   162   787.11   44,999         2288.12   4270.375261   1982.257284
297   44,999   159   787.11   44,372         2291.93   4284.609845   1992.678338
298   44,372   157   787.11   43,742         2295.75   4298.891878   2003.140485
299   43,742   155   787.11   43,109         2299.58   4313.221518   2013.643872
300   43,109   153   787.11   42,475         2303.41   4327.598923   2024.188648
301   42,475   150   787.11   41,838         2307.25   4342.024253   2034.774961
302   41,838   148   787.11   41,199         2311.09   4356.497667   2045.402959
303   41,199   146   787.11   40,558         2314.95   4371.019326   2056.072794
304   40,558   144   787.11   39,915         2318.80   4385.58939   2066.784614
305   39,915   141   787.11   39,269         2322.67   4400.208021   2077.538571
306   39,269   139   787.11   38,621         2326.54   4414.875382   2088.334815
307   38,621   137   787.11   37,971         2330.42   4429.591633   2099.173499
308   37,971   134   787.11   37,318         2334.30   4444.356938   2110.054774
309   37,318   132   787.11   36,663         2338.19   4459.171461   2120.978793
310   36,663   130   787.11   36,006         2342.09   4474.035366   2131.94571
311   36,006   128   787.11   35,346         2345.99   4488.948817   2142.955679
312   35,346   125   787.11   34,684         2349.90   4503.91198   2154.008853
313   34,684   123   787.11   34,020         2353.82   4518.92502   2165.105388
314   34,020   120   787.11   33,353         2357.74   4533.988104   2176.245438
315   33,353   118   787.11   32,684         2361.67   4549.101397   2187.429161
316   32,684   116   787.11   32,013         2365.61   4564.265069   2198.656712
317   32,013   113   787.11   31,339         2369.55   4579.479285   2209.928248
318   31,339   111   787.11   30,663         2373.50   4594.744216   2221.243927
319   30,663   109   787.11   29,985         2377.46   4610.06003   2232.603908
320   29,985   106   787.11   29,304         2381.42   4625.426897   2244.008348
321   29,304   104   787.11   28,620         2385.39   4640.844987   2255.457406
322   28,620   101   787.11   27,935         2389.36   4656.31447   2266.951244
323   27,935   99   787.11   27,247         2393.35   4671.835518   2278.49002
324   27,247   96   787.11   26,556         2397.33   4687.408303   2290.073896
325   26,556   94   787.11   25,863         2401.33   4703.032998   2301.703033
326   25,863   92   787.11   25,167         2405.33   4718.709774   2313.377593
327   25,167   89   787.11   24,469         2409.34   4734.438807   2325.097738
328   24,469   87   787.11   23,769         2413.36   4750.22027   2336.863633
329   23,769   84   787.11   23,066         2417.38   4766.054337   2348.675439
330   23,066   82   787.11   22,361         2421.41   4781.941185   2360.533322
331   22,361   79   787.11   21,653         2425.44   4797.880989   2372.437446
332   21,653   77   787.11   20,942         2429.49   4813.873926   2384.387977
333   20,942   74   787.11   20,229         2433.54   4829.920172   2396.38508
334   20,229   72   787.11   19,514         2437.59   4846.019906   2408.428922
335   19,514   69   787.11   18,796         2441.65   4862.173306   2420.51967
336   18,796   67   787.11   18,075         2445.72   4878.38055   2432.657492
337   18,075   64   787.11   17,352         2449.80   4894.641819   2444.842555
338   17,352   61   787.11   16,627         2453.88   4910.957291   2457.075029
339   16,627   59   787.11   15,898         2457.97   4927.327149   2469.355083
340   15,898   56   787.11   15,168         2462.07   4943.751573   2481.682887
341   15,168   54   787.11   14,434         2466.17   4960.230745   2494.058611
342   14,434   51   787.11   13,698         2470.28   4976.764847   2506.482427
343   13,698   49   787.11   12,960         2474.40   4993.354063   2518.954505
344   12,960   46   787.11   12,218         2478.52   5009.998577   2531.47502
345   12,218   43   787.11   11,474         2482.65   5026.698572   2544.044142
346   11,474   41   787.11   10,728         2486.79   5043.454234   2556.662047
347   10,728   38   787.11   9,979         2490.94   5060.265748   2569.328907
348   9,979   35   787.11   9,227         2495.09   5077.133301   2582.044898
349   9,227   33   787.11   8,473         2499.25   5094.057078   2594.810195
350   8,473   30   787.11   7,716         2503.41   5111.037269   2607.624974
351   7,716   27   787.11   6,956         2507.58   5128.074059   2620.489411
352   6,956   25   787.11   6,193         2511.76   5145.16764   2633.403684
353   6,193   22   787.11   5,428         2515.95   5162.318198   2646.367969
354   5,428   19   787.11   4,660         2520.14   5179.525926   2659.382446
355   4,660   17   787.11   3,890         2524.34   5196.791012   2672.447293
356   3,890   14   787.11   3,116         2528.55   5214.113649   2685.562691
357   3,116   11   787.11   2,340         2532.77   5231.494028   2698.728818
358   2,340   8   787.11   1,561         2536.99   5248.932341   2711.945856
359   1,561   6   787.11   780         2541.21   5266.428782   2725.213986
360   780   3   787.11   -4         2545.45   5283.983545   2738.533391
« Last Edit: March 16, 2017, 11:17:42 AM by Sulame66 »

waltworks

  • Magnum Stache
  • ******
  • Posts: 2517
Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #1 on: March 16, 2017, 12:00:19 PM »
Your magical no-maintenance, no-vacancy, no CapEx, no bad tenants that have to be evicted house is indeed an awesome investment.

-W

Sulame66

  • 5 O'Clock Shadow
  • *
  • Posts: 55
Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #2 on: March 16, 2017, 12:02:28 PM »
Didn't include the expenses because that goes in another bucket which I didn't describe well. Even if in one month I would need to pay for a repair, the rent would still be whatever it should be in that given month.

Vacancy would be harder to quantify, but almost the same idea as the maintenance, it would just be lower rent (none) instead of higher expense (the repair)

Don't know what Cap Ex is

Don't know what you mean by bad tenant

waltworks

  • Magnum Stache
  • ******
  • Posts: 2517
Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #3 on: March 16, 2017, 12:11:26 PM »
Didn't include the expenses because that goes in another bucket which I didn't describe well. Even if in one month I would need to pay for a repair, the rent would still be whatever it should be in that given month.

Vacancy would be harder to quantify, but almost the same idea as the maintenance, it would just be lower rent (none) instead of higher expense (the repair)

Don't know what Cap Ex is

Don't know what you mean by bad tenant

*slams forehead repeatedly against wall*

Go read some books on real estate and come back.

-W

Ayanka

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #4 on: March 16, 2017, 12:34:14 PM »
Please note I am anything but a professional on RE.

A bad tenant is a tenant that doesn't pay the rent and trashes the place. One example is my former up neighbours, who didn't ventilate the bathroom enough because it was in the middle of the house. Result was a whole lot of black mold. My estimate for the costs would be 2-3 k for that alone and that wasn't the only visible damage.

If you are going to consider this as a rental it is a business. A business that operates with costs and income, rather than income and expenses. The difference is costs are things that are written off that month, not necessarily expenses that go out that month. So you do have the put the % you assign for repairs aside every month, whether there is a repair that month or not.

A general rule of thumb is that approximately 50% of what you get as rent you can use for income/mortgage payments (see other thread inhere). Please look up some threads on this board.

YttriumNitrate

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #5 on: March 16, 2017, 01:24:20 PM »
Yes, you get some interesting numbers when the rate at which something is getting more expensive exceeds the rate of inflation for a long period.

College and health care are two macro examples that have been following that pattern for a while.

Sulame66

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #6 on: March 16, 2017, 02:22:27 PM »
Didn't include the expenses because that goes in another bucket which I didn't describe well. Even if in one month I would need to pay for a repair, the rent would still be whatever it should be in that given month.

Vacancy would be harder to quantify, but almost the same idea as the maintenance, it would just be lower rent (none) instead of higher expense (the repair)

Don't know what Cap Ex is

Don't know what you mean by bad tenant

*slams forehead repeatedly against wall*

Go read some books on real estate and come back.

-W

I am, as well as forums, where apparently my posts make people so upset they inflict physical harm on themselves for no logical reason.

marty998

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #7 on: March 16, 2017, 02:34:48 PM »
ok look it's really hard to see 30 years into the future but your assumption that rent will grow at 4% and other expenses at 2% is causing the issue. 2% differential sounds small but compounded over 30 years is a massive difference (why do you think we talk so much about mutual fund fees???)

I would suggest keeping both at 3% growth and reworking your calcs. Forget inflation for now, try and keep it simple, and perhaps only look at it over 15 years.

Take 4 weeks rent off a year for nominal vacancy and allow for HOA fees or major repairs of $3k per year (whichever is higher). Add insurance, local taxes, water, property manager fees, and another $1000 a year for things like air conditioner maintenance, carpet cleaning, new sets of keys, blinds, curtains, gardening, plumbing repairs etc etc.

Now show us your results.

Captain and Mrs Slow

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #8 on: March 17, 2017, 02:47:06 AM »
This might help, the numbers portion starts at min 44

Bigger Pockets How to Invest in Real Estate.

https://www.youtube.com/watch?v=l1u2qPXBadc&feature=youtu.be

Warning as with all seminars of this type there is the inevitable hype just ignore it.
« Last Edit: March 17, 2017, 02:51:41 AM by Captain and Mrs Slow »
I Embrace Frugality so I can have my Cake and Eat I Too

Forum Search sucks: forum = MMM + Search term in Google

Villanelle

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #9 on: March 17, 2017, 03:43:34 AM »
You say that maintenance and vacancy are a different bucket.  Okay, but you still have to account for that.  How can you "not see how that impacts the calculation?  If you spend an average of $2500 per year on maintenance, that directly affects the bottom line, even if some years that is $200 and some years (when the roof goes and the fridge dies and the toilet stops up and needs a plumber, and you have to replace the carpet because it's 14 years old, and ...) are $7500.  Likewise, if the place is empty for an average of 1 month every 2 years, that affects those rental incomes you have in your chart.  (Even if you are in a super hot rental market right now where there are almost no vacancies, you certainly can't assume that won't change over the next 30+ years). You can't just dismiss very real expenses because you are mentally categorizing them differently, and because they are less predictable and evenly distributed over time.  Why not declare that "taxes" are a different bucket, since they aren't paid monthly, either?  Then you can delete those, too, and your numbers look even better!  That makes no sense, right?  Well neither does not counting maintenance or vacancies. 

Also, where are you getting those 2% and 4% rates?  Did you pull those from some kind of research, or just pick them somewhat randomly?

Do you live in a state where property tax increases are capped?  If not, those could potentially go up at a far, far greater rate than 2%/yr.

Sulame66

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  • Posts: 55
Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #10 on: March 17, 2017, 07:53:05 AM »
ok look it's really hard to see 30 years into the future but your assumption that rent will grow at 4% and other expenses at 2% is causing the issue. 2% differential sounds small but compounded over 30 years is a massive difference (why do you think we talk so much about mutual fund fees???)

I would suggest keeping both at 3% growth and reworking your calcs. Forget inflation for now, try and keep it simple, and perhaps only look at it over 15 years.

Take 4 weeks rent off a year for nominal vacancy and allow for HOA fees or major repairs of $3k per year (whichever is higher). Add insurance, local taxes, water, property manager fees, and another $1000 a year for things like air conditioner maintenance, carpet cleaning, new sets of keys, blinds, curtains, gardening, plumbing repairs etc etc.

Now show us your results.

I took out the first month's rent of the year (4 weeks vacancy) then on the last month took out $4,000 for fees, also accumulating at 3% a year, and subtracted it from the rent to get a negative cash flow. End result is that I pay $40,000 up front to lose $24,750 over the next 15 years, which will then continue to grow as the expenses outpace the income.

So, obviously this is a good model (and accurate!) because everyone would be all over this fantastic opportunity.

month   balance   interest   payment   new balance         Total payments   Total Rent   Gain
1   160,000   567   787.11   159,780         1400   1600   200
2   159,780   566   787.11   159,558         1403.50   1604   200.5
3   159,558   565   787.11   159,336         1407.01   1608.01   201.00125
4   159,336   564   787.11   159,114         1410.53   1612.030025   201.5037531
5   159,114   564   787.11   158,890         1414.05   1616.0601   202.0075125
6   158,890   563   787.11   158,666         1417.59   1620.10025   202.5125313
7   158,666   562   787.11   158,440         1421.13   1624.150501   203.0188126
8   158,440   561   787.11   158,214         1424.68   1628.210877   203.5263596
9   158,214   560   787.11   157,988         1428.25   1632.281404   204.0351755
10   157,988   560   787.11   157,760         1431.82   1636.362108   204.5452635
11   157,760   559   787.11   157,532         1435.40   1640.453013   205.0566266
12   157,532   558   787.11   157,303         1438.98   1644.554146   -3794.430732
13   157,303   557   787.11   157,073         1442.58   1648.665531   206.0831914
14   157,073   556   787.11   156,842         1446.19   1652.787195   206.5983994
15   156,842   555   787.11   156,610         1449.80   1656.919163   207.1148954
16   156,610   555   787.11   156,378         1453.43   1661.061461   207.6326826
17   156,378   554   787.11   156,144         1457.06   1665.214114   208.1517643
18   156,144   553   787.11   155,910         1460.71   1669.37715   208.6721437
19   155,910   552   787.11   155,675         1464.36   1673.550593   209.1938241
20   155,675   551   787.11   155,440         1468.02   1677.734469   209.7168086
21   155,440   551   787.11   155,203         1471.69   1681.928805   210.2411007
22   155,203   550   787.11   154,966         1475.37   1686.133627   210.7667034
23   154,966   549   787.11   154,727         1479.06   1690.348961   211.2936202
24   154,727   548   787.11   154,488         1482.75   1694.574834   -3908.178146
25   154,488   547   787.11   154,248         1486.46   1698.811271   212.3514089
26   154,248   546   787.11   154,007         1490.18   1703.058299   212.8822874
27   154,007   545   787.11   153,766         1493.90   1707.315945   213.4144931
28   153,766   545   787.11   153,523         1497.64   1711.584235   213.9480293
29   153,523   544   787.11   153,280         1501.38   1715.863195   214.4828994
30   153,280   543   787.11   153,036         1505.13   1720.152853   215.0191066
31   153,036   542   787.11   152,790         1508.90   1724.453235   215.5566544
32   152,790   541   787.11   152,544         1512.67   1728.764368   216.0955461
33   152,544   540   787.11   152,298         1516.45   1733.086279   216.6357849
34   152,298   539   787.11   152,050         1520.24   1737.418995   217.1773744
35   152,050   539   787.11   151,801         1524.04   1741.762543   217.7203178
36   151,801   538   787.11   151,552         1527.85   1746.116949   -4025.335381
37   151,552   537   787.11   151,301         1531.67   1750.482241   218.8102802
38   151,301   536   787.11   151,050         1535.50   1754.858447   219.3573059
39   151,050   535   787.11   150,798         1539.34   1759.245593   219.9056991
40   150,798   534   787.11   150,545         1543.19   1763.643707   220.4554634
41   150,545   533   787.11   150,291         1547.05   1768.052816   221.006602
42   150,291   532   787.11   150,036         1550.91   1772.472948   221.5591185
43   150,036   531   787.11   149,781         1554.79   1776.904131   222.1130163
44   149,781   530   787.11   149,524         1558.68   1781.346391   222.6682989
45   149,524   530   787.11   149,266         1562.57   1785.799757   223.2249696
46   149,266   529   787.11   149,008         1566.48   1790.264256   223.783032
47   149,008   528   787.11   148,749         1570.40   1794.739917   224.3424896
48   148,749   527   787.11   148,488         1574.32   1799.226767   -4146.004654
49   148,488   526   787.11   148,227         1578.26   1803.724834   225.4656042
50   148,227   525   787.11   147,965         1582.20   1808.234146   226.0292682
51   147,965   524   787.11   147,702         1586.16   1812.754731   226.5943414
52   147,702   523   787.11   147,438         1590.13   1817.286618   227.1608272
53   147,438   522   787.11   147,173         1594.10   1821.829834   227.7287293
54   147,173   521   787.11   146,907         1598.09   1826.384409   228.2980511
55   146,907   520   787.11   146,640         1602.08   1830.95037   228.8687963
56   146,640   519   787.11   146,372         1606.09   1835.527746   229.4409683
57   146,372   518   787.11   146,104         1610.10   1840.116565   230.0145707
58   146,104   517   787.11   145,834         1614.13   1844.716857   230.5896071
59   145,834   516   787.11   145,563         1618.16   1849.328649   231.1660811
60   145,563   516   787.11   145,292         1622.21   1853.951971   -4139.164004
61   145,292   515   787.11   145,019         1626.26   1858.58685   232.3233563
62   145,019   514   787.11   144,746         1630.33   1863.233318   232.9041647
63   144,746   513   787.11   144,471         1634.40   1867.891401   233.4864251
64   144,471   512   787.11   144,196         1638.49   1872.561129   234.0701412
65   144,196   511   787.11   143,920         1642.59   1877.242532   234.6553165
66   143,920   510   787.11   143,642         1646.69   1881.935639   235.2419548
67   143,642   509   787.11   143,364         1650.81   1886.640478   235.8300597
68   143,364   508   787.11   143,084         1654.94   1891.357079   236.4196349
69   143,084   507   787.11   142,804         1659.07   1896.085472   237.0106839
70   142,804   506   787.11   142,523         1663.22   1900.825685   237.6032107
71   142,523   505   787.11   142,240         1667.38   1905.577749   238.1972187
72   142,240   504   787.11   141,957         1671.55   1910.341694   -4263.242528
73   141,957   503   787.11   141,673         1675.73   1915.117548   239.3896935
74   141,673   502   787.11   141,387         1679.92   1919.905342   239.9881677
75   141,387   501   787.11   141,101         1684.12   1924.705105   240.5881382
76   141,101   500   787.11   140,814         1688.33   1929.516868   241.1896085
77   140,814   499   787.11   140,525         1692.55   1934.34066   241.7925825
78   140,525   498   787.11   140,236         1696.78   1939.176512   242.397064
79   140,236   497   787.11   139,945         1701.02   1944.024453   243.0030566
80   139,945   496   787.11   139,654         1705.27   1948.884514   243.6105643
81   139,654   495   787.11   139,361         1709.54   1953.756726   244.2195907
82   139,361   494   787.11   139,068         1713.81   1958.641117   244.8301397
83   139,068   493   787.11   138,773         1718.10   1963.53772   245.442215
84   138,773   491   787.11   138,478         1722.39   1968.446564   -4255.979419
85   138,478   490   787.11   138,181         1726.70   1973.367681   246.6709601
86   138,181   489   787.11   137,883         1731.01   1978.3011   247.2876375
87   137,883   488   787.11   137,584         1735.34   1983.246853   247.9058566
88   137,584   487   787.11   137,285         1739.68   1988.20497   248.5256212
89   137,285   486   787.11   136,984         1744.03   1993.175482   249.1469353
90   136,984   485   787.11   136,682         1748.39   1998.158421   249.7698026
91   136,682   484   787.11   136,379         1752.76   2003.153817   250.3942271
92   136,379   483   787.11   136,075         1757.14   2008.161702   251.0202127
93   136,075   482   787.11   135,769         1761.53   2013.182106   251.6477632
94   135,769   481   787.11   135,463         1765.94   2018.215061   252.2768827
95   135,463   480   787.11   135,156         1770.35   2023.260599   252.9075749
96   135,156   479   787.11   134,847         1774.78   2028.31875   -4383.556453
97   134,847   478   787.11   134,538         1779.22   2033.389547   254.1736934
98   134,538   476   787.11   134,227         1783.66   2038.473021   254.8091276
99   134,227   475   787.11   133,916         1788.12   2043.569204   255.4461505
100   133,916   474   787.11   133,603         1792.59   2048.678127   256.0847658
101   133,603   473   787.11   133,289         1797.07   2053.799822   256.7249777
102   133,289   472   787.11   132,974         1801.57   2058.934322   257.3667902
103   132,974   471   787.11   132,658         1806.07   2064.081657   258.0102072
104   132,658   470   787.11   132,340         1810.59   2069.241861   258.6552327
105   132,340   469   787.11   132,022         1815.11   2074.414966   259.3018708
106   132,022   468   787.11   131,702         1819.65   2079.601004   259.9501254
107   131,702   466   787.11   131,382         1824.20   2084.800006   260.6000008
108   131,382   465   787.11   131,060         1828.76   2090.012006   -4375.844796
109   131,060   464   787.11   130,737         1833.33   2095.237036   261.9046295
110   130,737   463   787.11   130,413         1837.92   2100.475129   262.5593911
111   130,413   462   787.11   130,088         1842.51   2105.726317   263.2157896
112   130,088   461   787.11   129,761         1847.12   2110.990632   263.873829
113   129,761   460   787.11   129,434         1851.73   2116.268109   264.5335136
114   129,434   458   787.11   129,105         1856.36   2121.558779   265.1948474
115   129,105   457   787.11   128,775         1861.00   2126.862676   265.8578345
116   128,775   456   787.11   128,444         1865.66   2132.179833   266.5224791
117   128,444   455   787.11   128,112         1870.32   2137.510282   267.1887853
118   128,112   454   787.11   127,779         1875.00   2142.854058   267.8567573
119   127,779   453   787.11   127,444         1879.68   2148.211193   268.5263992
120   127,444   451   787.11   127,108         1884.38   2153.581721   -4367.898582
121   127,108   450   787.11   126,771         1889.09   2158.965676   269.8707094
122   126,771   449   787.11   126,433         1893.82   2164.36309   270.5453862
123   126,433   448   787.11   126,094         1898.55   2169.773997   271.2217497
124   126,094   447   787.11   125,753         1903.30   2175.198432   271.8998041
125   125,753   445   787.11   125,412         1908.06   2180.636428   272.5795536
126   125,412   444   787.11   125,069         1912.83   2186.08802   273.2610024
127   125,069   443   787.11   124,725         1917.61   2191.55324   273.944155
128   124,725   442   787.11   124,379         1922.40   2197.032123   274.6290153
129   124,379   441   787.11   124,033         1927.21   2202.524703   275.3155879
130   124,033   439   787.11   123,685         1932.03   2208.031015   276.0038768
131   123,685   438   787.11   123,336         1936.86   2213.551092   276.6938865
132   123,336   437   787.11   122,985         1941.70   2219.08497   -4642.10984
133   122,985   436   787.11   122,634         1946.55   2224.632682   278.0790853
134   122,634   434   787.11   122,281         1951.42   2230.194264   278.774283
135   122,281   433   787.11   121,927         1956.30   2235.76975   279.4712187
136   121,927   432   787.11   121,572         1961.19   2241.359174   280.1698968
137   121,572   431   787.11   121,215         1966.09   2246.962572   280.8703215
138   121,215   429   787.11   120,857         1971.01   2252.579979   281.5724973
139   120,857   428   787.11   120,498         1975.93   2258.211429   282.2764286
140   120,498   427   787.11   120,138         1980.87   2263.856957   282.9821196
141   120,138   425   787.11   119,776         1985.83   2269.516599   283.6895749
142   119,776   424   787.11   119,413         1990.79   2275.190391   284.3987989
143   119,413   423   787.11   119,049         1995.77   2280.878367   285.1097959
144   119,049   422   787.11   118,684         2000.76   2286.580563   -4781.257755
145   118,684   420   787.11   118,317         2005.76   2292.297014   286.5371268
146   118,317   419   787.11   117,949         2010.77   2298.027757   287.2534696
147   117,949   418   787.11   117,580         2015.80   2303.772826   287.9716033
148   117,580   416   787.11   117,209         2020.84   2309.532258   288.6915323
149   117,209   415   787.11   116,837         2025.89   2315.306089   289.4132611
150   116,837   414   787.11   116,464         2030.96   2321.094354   290.1367943
151   116,464   412   787.11   116,089         2036.03   2326.89709   290.8621363
152   116,089   411   787.11   115,713         2041.13   2332.714333   291.5892916
153   115,713   410   787.11   115,336         2046.23   2338.546119   292.3182648
154   115,336   408   787.11   114,957         2051.34   2344.392484   293.0490605
155   114,957   407   787.11   114,577         2056.47   2350.253465   293.7816831
156   114,577   406   787.11   114,196         2061.61   2356.129099   -4924.576598
157   114,196   404   787.11   113,813         2066.77   2362.019422   295.2524277
158   113,813   403   787.11   113,429         2071.93   2367.92447   295.9905588
159   113,429   402   787.11   113,044         2077.11   2373.844281   296.7305352
160   113,044   400   787.11   112,657         2082.31   2379.778892   297.4723615
161   112,657   399   787.11   112,269         2087.51   2385.728339   298.2160424
162   112,269   398   787.11   111,879         2092.73   2391.69266   298.9615825
163   111,879   396   787.11   111,488         2097.96   2397.671892   299.7089865
164   111,488   395   787.11   111,096         2103.21   2403.666071   300.4582589
165   111,096   393   787.11   110,703         2108.47   2409.675237   301.2094046
166   110,703   392   787.11   110,307         2113.74   2415.699425   301.9624281
167   110,307   391   787.11   109,911         2119.02   2421.738673   302.7173342
168   109,911   389   787.11   109,513         2124.32   2427.79302   -5072.19139
169   109,513   388   787.11   109,114         2129.63   2433.862502   304.2328128
170   109,114   386   787.11   108,713         2134.95   2439.947159   304.9933948
171   108,713   385   787.11   108,311         2140.29   2446.047027   305.7558783
172   108,311   384   787.11   107,908         2145.64   2452.162144   306.520268
173   107,908   382   787.11   107,503         2151.01   2458.29255   307.2865687
174   107,503   381   787.11   107,096         2156.38   2464.438281   308.0547851
175   107,096   379   787.11   106,689         2161.77   2470.599377   308.8249221
176   106,689   378   787.11   106,279         2167.18   2476.775875   309.5969844
177   106,279   376   787.11   105,869         2172.60   2482.967815   310.3709768
178   105,869   375   787.11   105,456         2178.03   2489.175234   311.1469043
179   105,456   373   787.11   105,043         2183.47   2495.398172   311.9247715
180   105,043   372   787.11   104,628         2188.93   2501.636668   -5224.230899

waltworks

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #11 on: March 17, 2017, 08:52:39 AM »
Dude, format the damn cells!

-W

dandarc

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #12 on: March 17, 2017, 09:00:15 AM »
Or just attach the spreadsheet . . .

mishek01

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #13 on: March 17, 2017, 09:33:06 AM »
Sulame66 you have a lot to learn about real estate, but it is good that you are starting early at 23. You haven't done a ton of research yet, but that is ok, you will learn. There is no better way to learn than from experience. (I am being sincere and not sarcastic.)

I see you are getting a lot of negative comments, and this may upset you some, but the other posters are right (except for being mean about how some things are worded.) I started in real estate at 25 and now I am 30 and getting closer to retirement (so congrats on starting even earlier!)

I will demonstrate why your numbers don't work with a simple example. This is an example of one of the properties I own (this is one of the least profitable properties, so I am not choosing the best one to brag or to give you unrealistic numbers.)
All in cost 93k
Rent $1,100 month

My conservative estimates on costs (this is specific to my area, yours maybe different:)
$1400 taxes (current assessment is different than "All in cost")
$550 insurance
$1980 repairs (Only averaged $200 per year for the last 4 years, but room needed to be replaced and I spent $5,300)
$1320 vacancies (haven't had any yet, but my tenant is moving out in July, so it will happen, and if it takes me a couple of months to rent it out then I will close to half that number for average over the years.)
$0 mortgage (it is paid off now, but you can substitute your number here)

If I had a mortgage on this house my cash flow would be very close to zero, but this is one of my worst investment (my first house I bought for myself to live in.) The reason I am showing you all this is to show that rent-to-value is what determines your cashflow (the area and the quality of tenants in that area plays a large role too, but lets assume that both of our properties are in good areas, mine is.) My rent-to-value ratio for this property is 1.18% in percent and I make little cash flow (assuming I have a mortgage), and your rent-to-value ratio is 0.7%, which realistically will not cash-flow. Numbers just won't work out, no matter what you do, and I think you saw that in your last calculations. Most people in real estate (from blogs and podcasts and real estate meetups) have bare minimum rent-to-value ratio of 1%, and that depends on the market and the demographic of the area because some expect that ratio to be a lot higher than that.

Keep in mind that even at cashflow of close to zero you are paying off your principal, so your net worth is growing regardless, so it may not be a total loss. The property is more than likely appreciating as well, so your net worth is gaining not just by principle being paid off, but by principle and appreciation rate in your area. I think you are starting to realize that you need to learn a bit more, and I wish you luck on your journey. I wouldn't call myself an expert, but I am not a novice either, so if you have any questions, I would be happy to attempt to help.

Sulame66

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #14 on: March 20, 2017, 11:38:42 AM »
I have no idea what a rent-to-value is, but there is absolutely nothing anywhere near me that would return $1,100 a month for a cost of 93k. And at that level, that property is barely profitable to you, and it also seems evident you're not using a property management company, which I need to.

Essentially, I'm trading dumping $750 a paycheck into my 401(k) where it will go up and down for 30 years (while I ignore it) and then hope it's valued at whatever the math turns out to be for an ~7% return over those 30 years for saving that $750 a paycheck for 120 weeks to get the $45k cash required to put a down payment on a property that I will see an actual in or outflow of cash each month as opposed to virtual money until I retire. Because of this I'll either win big and see all the benefits of a 401(k) investment except with the added advantage of getting the gains each month, or lose big and just go bankrupt by having to pay rent + a mortgage on a property I don't live in or use because nobody will move in. In other words, a crap chute like every other investment. Just something to toss money at because instead of dying off at 55 like my ancestors I get the privilege of living to 110 with no family or relatives while a nursing home caretaker changes my diapers and spoon feeds me liquefied carrots for the low cost of 250k a year that I worked my entire life to accrue but by virtue of saving never actually got to do anything with. And because working for 40 years while saving 40-60% of my income gives me a lower standard of living for just myself than working 40 years and saving 5% of my income would have provided for my entire family not even 50 years ago, I don't have any other option. But that's ok, because I guess I have a smartphone and a computer and a bigger TV so I'm clearly coming out ahead.

Awesome. Glad I spent 2 months of my life looking into this.
« Last Edit: March 20, 2017, 11:46:30 AM by Sulame66 »

dandarc

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #15 on: March 20, 2017, 12:03:36 PM »
If it is any comfort, you'll probably die a long time before 110.  Medicine has improved, but it isn't yet magic.

You know what also isn't magic, and never has been?  Investing.  Stocks, real estate, even government bonds all have risks.

Since your issue with stock market investing is fear, read the stock series.  http://jlcollinsnh.com/stock-series/  If you're still afraid, read it again.

Have you actually read any of the blog here?  Because investing 40-60% for 40 years is pretty fucking dumb.  If you're for sure going to work for 40 years, and simply want to maintain lifestyle in retirement, go with a lower savings rate.  The whole point of investing large sums like that is that you won't have to work for 40 years.

Sulame66

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #16 on: March 20, 2017, 02:19:40 PM »
I make 62k. To hit the 18k 401(k) and 5.5k Roth 401(k) max, I'm looking at (18,000 + 5.5*1.25) / 62,000 = 40% of my income. This is also assuming zero debt, which isn't currently the case. And once the debt is gone, good debt will eventually be taken on, and paying that off is savings as well

And it isn't fear, it's annoyance that saving that much money is now a requirement to sustain myself until I die, which is either going to be in a car wreck tomorrow or at some indeterminate point within the next 60 years that the best actuary can't predict but I'm supposed to be able to

dandarc

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #17 on: March 20, 2017, 02:49:26 PM »
So you're angry that you're "required" to invest 40-60% per year for 40 years to "sustain yourself until you die".  Who told you that?  There is no such requirement.  Lots of people save essentially nothing over their lives in this country and manage to live good, long lives.

People on this forum do invest that amount per year or even more, but it is so we can reach financial independence in 10-20 years or less, not work into our 60's and 70's and eventually die with 8 or 9 figure estates.

http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

waltworks

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #18 on: March 20, 2017, 03:16:26 PM »
Dude, this is easily the best time to be alive in human history. You have a much better chance of living a long, healthy life than you ever would have even 50 years ago, and you'll need to work much less than you would have at any time in history to support yourself, too.

Focus on the positive. You are one lucky SOB. Go out and kick some ass and save up to do whatever it is that you want to do. Just don't buy any real estate that isn't 1%/50% rule compliant along the way!

-W

Sulame66

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #19 on: March 22, 2017, 10:00:51 AM »
So you're angry that you're "required" to invest 40-60% per year for 40 years to "sustain yourself until you die".  Who told you that?  There is no such requirement.  Lots of people save essentially nothing over their lives in this country and manage to live good, long lives.

People on this forum do invest that amount per year or even more, but it is so we can reach financial independence in 10-20 years or less, not work into our 60's and 70's and eventually die with 8 or 9 figure estates.

http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

Here are the two scenarios:

1) Invest 5-15%, save the rest. Pay off the remainder of my debt within 6 months. Take 2-3 years to save a 20% down payment using projected real estate inflation in my area, then drop $45k on a $225k home. Pay off the $180k balance over the next 10 years or so, and have a paid off house with no other debt. Save another 10 years to get a large enough nest egg to retire early. All together, spending essentially nothing other than extra towards debt, we're looking at almost 20 years. Keep in mind I've been working for 5 already doing nothing but paying down debt and spending ~ 3% of my income a year on 'fun'.

2) Invest 40-60%, save the rest. Pay off the remainder of my debt within 12 months. Take 5-6 years to save a 20% down payment using projected real estate inflation in my area, then drop $50k on a $250k home. Pay off the $200k balance over the next 15-20 years or so, and have a paid off house with no other debt. Save another 3-5 years or so to get a large enough nest egg to retire early. All together, spending essentially nothing other than extra towards debt and investing for retirement, we're looking at 25-30 years. Keep in mind I've already been doing nothing but paying down debt and spending ~ 3% of my income a year on 'fun'.

Fantastic options. Or I could just continue to rent forever, have an excess of $2,000 a month with no clue what to do with it or what the point is, and save that for when I inevitably get cancer or diabetes at 42 and lose it all on a doctor bill. But, hey, at least I'm healthy and alive, right

Honestly, at this point, I might as well just get into a 4 bedroom house as quickly as possible, rent out the other 3 rooms, and just combine every idea in this thread

dandarc

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #20 on: March 22, 2017, 10:43:55 AM »
This will be my last post in this complainy-pants thread:

Actually that is a great plan at the end there - your net on your house will be quite a bit less with 3 roommates.  You might even come out ahead on the deal.

Why am I done with this?  Deliberately doing your math wrong over and over again is a bad look.

okobrien

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #21 on: March 22, 2017, 09:16:51 PM »

Honestly, at this point, I might as well just get into a 4 bedroom house as quickly as possible, rent out the other 3 rooms...
I don't know if you were being sarcastic here, but yes, this is exactly what you should do.

Villanelle

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #22 on: March 22, 2017, 10:14:59 PM »
Have you read the MMM blog posts?   Have you run the actual numbers in your first scenario?  Would it really take you 10 years to save up enough for FIRE, with a paid off house?  You'd be able to take all the money currently servicing your debt, and then all the money that was paying the mortgage (once it is paid off) and add that to what you were already saving.  It seems to me like that should add up to a nice 4% stache pretty quickly.  But without actual numbers, it's impossible to say.

Have you considered other ways to increase your income or reduce your expenses?  Have you posted a case study?

Plenty of people make it to FIRE in far less time than you've come up with for your two scenarios.

And yes, a house with roommates is a great idea. 


Sulame66

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #23 on: March 23, 2017, 03:16:51 PM »
I've run numbers twice and nobody cared so I'll just toss some out and wave my hands.

By the time I can get a 20% down payment the houses in the range I'm looking will probably be 250 (since I wouldn't be buying to rent out anymore, I'd go a little higher) if not 260. Property taxes at that level are around $450-$500 a month, and will continue to rise forever since real estate will continue to rise forever.

Before we even get to that, let's just figure out 4%. Well, CURRENTLY, $450-$500 a month averages to $5,700 a year. Let's add in another $175 for auto and home, that's $2,100. Can't forget food and gas and utilities which is probably around $400, that's $4,800. Without a job I'll be on some ridiculous health plan probably costing $300 or so a month, that's another $3,600. So far we're at $16,200 before I've even spent money on, you know, doing stuff since I'm FIRE. Let's be super conservative and say I only need $1,300 a year for whatever. That's $17,500 all in. At 4% that means my nest egg needs to be $437,500 in today's money. Using JUST inflation and moving out 10 years, which also means I'd have to be in the house TODAY, 437,500 * (1.03^10) = $587,963.4.

So with a whopping $42k in my 401(k), dumping everything into debt, then needing to save $50k cash money asap to get into a house and then throwing everything I have at the mortgage, I need to gain $540k in 10 years with a cap of $23.5k a year. Then I need to take the penalties since I'm not 59.5 when any of this happens. Now factor in that this is all delayed X years where X is how long it takes me to get into the house and pay it off, and we're looking at a long time.

But, as evidenced by everything I've ever posted, I know nothing about anything

okobrien

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #24 on: March 23, 2017, 04:00:37 PM »
A couple of thoughts:
1. FIRE isn't easy. If it were, everyone would do it. Some in this forum make it sound easy, and some people earn 4x what you earn. That being said, make some sacrifices, work hard, and be creative, and it can work.

2. Your attitude is one of the worst ones I have ever come across. From your posts you seem like a spoiled, whiny 12 year old. I think you need to spend some time in a poor country to get some perspective on life.

3. When you return from your gaining perspective trip, house hack.

Sent from my SM-G900V using Tapatalk


waltworks

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Re: My cash flow diagrams are wonky. I can't accurately predict anything
« Reply #25 on: March 23, 2017, 04:38:42 PM »
Wow.

Go post a case study in that subforum. You'll get lots of good advice on how you can be FI and you can figure out scenarios in lots of detail if you want to. There's a nice form you can fill out to figure out exactly what you're spending where, what your gross/net pay end up at, your assets, etc.

And seriously, if you don't like the answers, whining about your life isn't a great response. There's a lot of information and help available here, but nobody likes a crybaby. Your life does not (financially at least) suck at all compared with most of the world, or even most of the United States.

-W