PRE-LEASED Home - Long-Term Tenant & NO HOA
Birmingham, AL 35206
3bd • 1ba • Built: 1965 • Remodeled: 2022
| Projected Income | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Projected Rent | $14,100 | $14,664 | $15,251 | $15,861 | $16,495 | $17,155 | $17,841 | $18,555 | $19,297 | $20,069 |
| Vacancy Losses | ($1,128) | ($1,173) | ($1,220) | ($1,269) | ($1,320) | ($1,372) | ($1,427) | ($1,484) | ($1,544) | ($1,605) |
| Operating Income | $12,972 | $13,491 | $14,031 | $14,592 | $15,175 | $15,782 | $16,414 | $17,070 | $17,753 | $18,463 |
| Estimated Expenses | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Property Taxes | ($1,040) | ($1,071) | ($1,103) | ($1,136) | ($1,171) | ($1,206) | ($1,242) | ($1,279) | ($1,317) | ($1,357) |
| Insurance | ($672) | ($692) | ($713) | ($734) | ($756) | ($779) | ($802) | ($826) | ($851) | ($877) |
| Management Fees | ($1,032) | ($1,073) | ($1,116) | ($1,161) | ($1,207) | ($1,256) | ($1,306) | ($1,358) | ($1,412) | ($1,469) |
| Leasing/Advertising Fees | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Association Fees | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Maintenance | ($282) | ($290) | ($299) | ($308) | ($317) | ($327) | ($337) | ($347) | ($357) | ($368) |
| Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Operating Expenses | ($3,026) | ($3,127) | ($3,232) | ($3,340) | ($3,452) | ($3,567) | ($3,687) | ($3,810) | ($3,938) | ($4,071) |
| 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 | $9,946 | $10,364 | $10,799 | $11,252 | $11,724 | $12,215 | $12,727 | $13,260 | $13,815 | $14,393 |
| - Mortgage Payments | ($7,500) | ($7,500) | ($7,500) | ($7,500) | ($7,500) | ($7,500) | ($7,500) | ($7,500) | ($7,500) | ($7,500) |
| = Cash Flow | $2,446 | $2,864 | $3,299 | $3,752 | $4,224 | $4,715 | $5,227 | $5,760 | $6,315 | $6,893 |
| + Principal Reduction | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| + Appreciation | $9,600 | $10,176 | $10,787 | $11,434 | $12,120 | $12,847 | $13,618 | $14,435 | $15,301 | $16,219 |
| = Gross Equity Income | $12,046 | $13,040 | $14,085 | $15,186 | $16,344 | $17,562 | $18,845 | $20,195 | $21,616 | $23,112 |
| Capitalization Rate | 5.9% | 5.8% | 5.7% | 5.6% | 5.5% | 5.4% | 5.3% | 5.2% | 5.1% | 5.0% |
| Cash on Cash Return | 5.3% | 6.2% | 7.1% | 8.1% | 9.1% | 10.2% | 11.3% | 12.4% | 13.6% | 14.9% |
| Return on Equity | 24.3% | 21.8% | 20.0% | 18.5% | 17.4% | 16.4% | 15.6% | 15.0% | 14.4% | 13.9% |
| Loan Analysis | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Market Value | $169,600 | $179,776 | $190,563 | $201,996 | $214,116 | $226,963 | $240,581 | $255,016 | $270,317 | $286,536 |
| - Loan Balance | ($120,000) | ($120,000) | ($120,000) | ($120,000) | ($120,000) | ($120,000) | ($120,000) | ($120,000) | ($120,000) | ($120,000) |
| = Equity | $49,600 | $59,776 | $70,563 | $81,996 | $94,116 | $106,963 | $120,581 | $135,016 | $150,317 | $166,536 |
| Loan-to-Value Ratio | 70.8% | 66.7% | 63.0% | 59.4% | 56.0% | 52.9% | 49.9% | 47.1% | 44.4% | 41.9% |
| Potential Cash-Out Refi | $15,680 | $23,821 | $32,450 | $41,597 | $51,293 | $61,570 | $72,465 | $84,013 | $96,253 | $109,229 |
| Sale Analysis | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 |
|---|
| Equity | $49,600 | $59,776 | $70,563 | $81,996 | $94,116 | $106,963 | $120,581 | $135,016 | $150,317 | $166,536 |
| - Closing Costs | ($11,872) | ($12,584) | ($13,339) | ($14,140) | ($14,988) | ($15,887) | ($16,841) | ($17,851) | ($18,922) | ($20,057) |
| = Proceeds After Sale | $37,728 | $47,192 | $57,223 | $67,857 | $79,128 | $91,076 | $103,740 | $117,165 | $131,394 | $146,478 |
| + Cumulative Cash Flow | $2,446 | $5,310 | $8,609 | $12,361 | $16,584 | $21,300 | $26,527 | $32,287 | $38,601 | $45,494 |
| - Approximate Cash Invested | ($46,400) | ($46,400) | ($46,400) | ($46,400) | ($46,400) | ($46,400) | ($46,400) | ($46,400) | ($46,400) | ($46,400) |
| = Net Profit | ($6,226) | $6,101 | $19,432 | $33,817 | $49,312 | $65,975 | $83,867 | $103,051 | $123,596 | $145,572 |
| Internal Rate of Return | -13.4% | 6.5% | 13.0% | 15.7% | 16.9% | 17.5% | 17.8% | 17.9% | 17.8% | 17.7% |
| Return on Investment | -13.4% | 13.1% | 41.9% | 72.9% | 106.3% | 142.2% | 180.7% | 222.1% | 266.4% | 313.7% |
*Information is not guaranteed and investors should do their own research, get professional advice and conduct due diligence prior to investing.