Investors Checklist #102

Property Analysis

Here’s an example of a Property analysis, make sure you’re comfortable with the Guidelines YOU use! Mike

 

1.Price/Square Foot

2.Cap Rate

Net Operating Income = Capitalization Rate

Purchase Price

*NOI

Gross Rental Income (annual)

  • Vacancy
  • Real Estate tax
  • Insurance
  • Maintenance

NO PI!

NOI_____________

3.Rate of Return

Net Income = RoR

Investment

4.Income Approach GRM

Value/Monthly Rent = GRM

Example

MLS # 72398682 – Sold

Multi Family – 3 Family

15 Dodge St

Beverly, MA: North Beverly,  01915-1712

Essex County

List Price: $569,900

Sale Price: $565,000

Color: GREY

Total Floors: 2 Total Rooms: 13

Total Units: 3 Total Bedrooms: 6

Total Rent: $0 Total Bathrooms: 3f 1h

Grade School: Total Fireplaces: 2

Middle School:

High School:

Directions: Route 1A Near 128

Remarks

Great Value for this charming North Beverly three family , 5 room three bedroom owners unit with Modern Country Kitchen, Featuring granite counters and stainless steel appliances, Beautiful hardwood floors, Formal dining room , 1 and 1/2 baths , Plus 4 room 1 bedroom unit and 3 room 1 bedroom unit, Close to Highway and Downtown, Large lot with fenced in yard and plenty of parking. Separate Utilities

Property Information

Approx. Living Area: 2,704 Sq. Ft. Approx. Acres: 0.2 (8,875 Sq. Ft.) Garage Spaces: 0

Living Area Includes: Heat/Cool Zones: Parking Spaces: 6 Off-Street, Improved Driveway, Stone/Gravel

Living Area Source: Public Record Heat/Cool Units: 3 Approx. Street Frontage: 50 Ft.

Living Area Disclosures:

Disclosures:

Annual Expenses

Heating: Repair & Maintenance: Management: Gross Income:

Gas: Trash Removal: Miscellaneous: Gross Expenses:

Electricity: Sewer: Ann. Prop. Oper. Data: No Net Income:

Water: Insurance: Annual Expense Source:

Unit Descriptions

Unit #1

Rooms: 3 Bedrooms: 1 Bathrooms: 1f 0h Fireplaces: 0 Levels: 1 Floor: 1 Rent: 0 Lease: No

Rooms: Living Room, Kitchen

Appliances: Range

Unit #2

Rooms: 4 Bedrooms: 2 Bathrooms: 1f 0h Fireplaces: 0 Levels: 1 Floor: 1 Rent: 0 Lease: No

Rooms: Living Room, Kitchen

Appliances: Range

Unit #3

Rooms: 6 Bedrooms: 3 Bathrooms: 1f 1h Fireplaces: 1 Levels: 1 Floor: 2 Rent: 0 Lease: No

Rooms: Living Room, Dining Room, Kitchen

Appliances: Range

Features

Area Amenities: Public Transportation, Shopping, Medical Facility, Highway Access, House of Worship, Public School

Basement: Yes Full, Interior Access, Bulkhead

Beach: No

Construction: Frame

Electric: Circuit Breakers, 60 Amps/Less

Energy Features: Insulated Windows

Exterior: Wood

Exterior Features: Porch

Flooring: Wood, Tile, Vinyl, Wall to Wall Carpet, Varies Per Unit

Foundation Size: 26*55

Foundation Description: Fieldstone

Hot Water: Natural Gas, Tank

Lot Description: Level

Road Type: Public

Roof Material: Asphalt/Fiberglass Shingles

Sewer Utilities: City/Town Sewer

Terms: Seller W/Participate

Utility Connections: Varies per Unit

Water Utilities: City/Town Water

Waterfront: No

Water View: No

  Other Property Info

Adult Community: No

Disclosure Declaration: No

Exclusions:

Facing Direction: West

Lead Paint: Unknown

UFFI: No Warranty Features: No

Year Built: 1880 Source: Public Record

Year Built Description: Approximate

Year Round:

Short Sale w/Lndr. App. Req: No

Lender Owned: No

Tax Information

Pin #: M:0054 B:0011 L:

Assessed: $349,700

Tax: $4,756 Tax Year: 2018

Book: 0 Page: 0

Cert:

Zoning Code: R10

Map: Block: Lot:

Market Information

Listing Date: 9/19/2018 Listing Market Time: MLS# has been on for 91 day(s)

Days on Market: Property has been on the market for a total of 91 day(s) Office Market Time: Office has listed this property for 91 day(s)

Expiration Date: Cash Paid for Upgrades:

Original Price: $589,900 Seller Concessions at Closing: $5,000

Off Market Date: 12/18/2018 Financing: FHA

Sale Date: 1/16/2019

Sale Price: $565,000

Offer Date: 12/4/2018         Days to Offer: 76

1.Price/Square Foot

$565,000./2704 SF = $209/SF

2.Capitalization Rate

$1800 x 3 x 12 =$64,800.

RE Tax = ($4756.)

Insurance = ($1800.)

Vacancy 5% = ($3240.)

Maintenance = ($3240.)

NOI     $51764.

Cap = Net Income/Value

$51,764./$565,000 = 0.092 9.2 Cap Rate

3.Rate of Return

RoR = Net Income/Investment

$51,764./$113,000. (20% down) = 45.8% Rate of Return

4.Income Approach GRM

Value/Monthly Rent = GRM

$565,000./$5600. = 100.89

OR

$5,600./$565,000. = 1% WooHoo!!

By the Bye…

Rents $64,800.

Expenses ($13,036.)

NOI $51,764.

MT ($30,796.) 80%, 5.5%, 30Yr $2,566.46/month

Cash Flow $20,967.

Mike Hurney
 

Mike Hurney is the Founder and Director of MassRealEstate.net, an Association of Contractors, Investors and Landlords. He is the Author and Coach of the popular Course "How to Become a Real Estate Investor in 12 Simple Lessons" which Trains and Guides Beginners or Sharpens and Challenges the Skill of Advanced Investors. Mike is a Successful Real Estate Investor, Rehabber and Landlord. He's also a licensed Real Estate Broker and Construction Supervisor. MassRealEstate.net PO Box 307, Marblehead, MA 01945 Office 781-405-1845 [email protected]

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