1433 SW Lincoln St, Topeka KS 66604

1433 SW Lincoln St, Topeka, KS 66604

Multifamily: 18 bedrooms

Year built: 1951,

Investment strategy: Rental Property

Purchase Price$ 600,000

Rent$ 6,820/mo

Monthly Cash Flow$ -404

Cash on Cash Return-2.93 %

Financial Analysis

Cash on Cash Return	-2.93 %
Internal Rate of Return (IRR)	6.23 %
Capitalization Rate	5.18 %
Gross Rent Multiplier (GRM)	7.33
Debt-coverage Ratio (DCR)	0.86
Operating Expense Ratio (OER)	60.03 %

Financial Breakdown

Purchase Price	$ 600,000
Purchase Costs	$ 10,500
Repair/Construction Costs	$ 5,000
Total Capital Needed Total Capital Needed Includes all projects costs (except selling costs). Total Capital Needed Includes all projects costs (except selling costs).	$ 615,500
Financing	$ 450,000
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 165,500
Cash at Closing Cash at Closing This number includes down payment and loan points. Cash at Closing This number includes down payment and loan points.	$ 154,500
Cash During Rehab Cash During Rehab Shows the cash amount remaining to fund the purchase and rehab/construction. Cash During Rehab Shows the cash amount remaining to fund the purchase and rehab/construction.	$ 11,000

Operating Analysis

Rent	$ 6,820/mo
Gross Operating Income (GOI)	$ 77,748
Total Expenses	$ 46,675
Net Operating Income (NOI)	$ 31,073
Annual Debt Service	$ 35,926
Cash Flow Before Taxes (CFBT)	$ -4,854
Income Tax Liability	$ -4,434
Cash Flow After Taxes (CFAT)	$ -419

Amazing opportunity to own a well cared for apartment building. This wonderful property is conveniently located close to highway access, hospitals, eating establishments etc. Call to schedule your showing today as this rare find will not last long!

Purchase Price	$ 600,000
Address	1433 SW Lincoln St , Topeka, 66604, KS
MLS^® #	233311
Listing Agent	Patrick Habiger
Year Built	1951
Type	Multifamily
Number of Units	12
Bedrooms	18

Property History

Date	Price	Event
5/8/2024	600000	Price Changed
4/30/2024	695000	Listed
4/11/2024	695000	Price Changed
3/28/2024	745000	Listed
12/8/2022		Listing removed
11/22/2022	650	Price Changed for rent
11/18/2022	675	Price Changed for rent
10/13/2022	700	Listed for rent
8/31/2022		Listing removed
8/17/2022	525	Price Changed for rent
6/9/2022	575	Listed for rent
5/17/2022		Listing removed
5/10/2022	675	Listed for rent
11/15/2021		Listing removed
11/9/2021	675	Listed for rent
10/15/2021		Listing removed
10/15/2021		Listing removed
10/2/2021	675	Price Changed for rent
9/21/2021	575	Listed for rent
9/10/2021	700	Price Changed for rent
9/9/2021	675	Listed for rent
12/13/2018		Sold
10/20/2018		Listing removed
8/22/2018	525	Listed for rent
8/17/2018		Listing removed
7/25/2018	525	Listed for rent
1/30/2018		Sold
10/15/2017	475	Listing removed
12/28/2016	475	Listed for rent
5/5/2016	475	Listing removed
4/17/2016	475	Listed for rent
10/31/2001		Sold

Annual Property Operating Data

Incomes		% of GOI
Gross Scheduled Income Gross Scheduled Income (GSI) Represents the total of monthly rents for the particular property, including the potential rents from vacant units and uncollectable rents. Gross Scheduled Income (GSI) Represents the total of monthly rents for the particular property, including the potential rents from vacant units and uncollectable rents.	$ 81,840
Total Gross Income	$ 81,840
Vacancy loss Vacancy and Credit Loss Part of the potential rental income that is lost because of unoccupied units or uncollectable rent from tenants. Vacancy and Credit Loss Part of the potential rental income that is lost because of unoccupied units or uncollectable rent from tenants.	$ 4,092
Gross Operating Income Gross Operating Income (GOI) An actual income which is expected to be collected in the property. Gross Operating Income (GOI) An actual income which is expected to be collected in the property.	$ 77,748	100.00 %
Expenses Operating Expenses Expenses necessary for maintaining the property and ensuring its continued ability to produce income (doesn't include mortgage payments or depreciation). Operating Expenses Expenses necessary for maintaining the property and ensuring its continued ability to produce income (doesn't include mortgage payments or depreciation).
Property manager	$ 6,220	8.00 %
Utilities	$ 18,000	23.15 %
Insurance	$ 10,000	12.86 %
Repairs	$ 3,887	5.00 %
Property tax	$ 8,568	11.02 %
Total Expenses	$ 46,675	60.03 %
Net Operating Income Net Operating Income (NOI) Important measurement calculated as gross operating income minus operating expenses. Net Operating Income (NOI) Important measurement calculated as gross operating income minus operating expenses.	$ 31,073	39.97 %

Cash Flow (Year 1)

Net Operating Income	$ 31,073	39.97 %
Annual Debt Service	$ 35,926	46.21 %
Cash Flow Before Taxes (CFBT) Cash Flow All the inflows and outflows of cash for a certain property (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property. Cash Flow All the inflows and outflows of cash for a certain property (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property.	$ -4,854	-6.24 %
Income Tax Liability	$ -4,434	-5.70 %
Cash Flow After Taxes (CFAT) Cash Flow All the inflows and outflows of cash (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property. Cash Flow All the inflows and outflows of cash (including mortgage payments). We can calculate cash flow before taxes (CFBT) or cash flow after taxes (CFAT) which is CFBT minus any tax liability arising from the operation of the property.	$ -419	-0.54 %

Operating Ratios

Operating Expense Ratio Operating Expense Ratio Ratio of the operating expenses to the gross operating income (GOI). Operating Expense Ratio Ratio of the operating expenses to the gross operating income (GOI).	60.03 %
Break-Even Ratio Break-Even Ratio (BER) Another benchmark used by mortgage lenders, estimating how vulnerable is a certain property to defaulting on its mortgage if part of the rental income is declined. Most of the lenders are looking for BER of 85% or less. Break-Even Ratio (BER) Another benchmark used by mortgage lenders, estimating how vulnerable is a certain property to defaulting on its mortgage if part of the rental income is declined. Most of the lenders are looking for BER of 85% or less.	106.24 %

Financial Measures

Net Present Value Net Present Value (NPV) Probably the best measure of any investment thanks to its complexity; taking into account all future cash flows including the selling price, and it converts all these amounts to their present values using discount rate required by the investor. More information and an example on the blog. Net Present Value (NPV) Probably the best measure of any investment thanks to its complexity; taking into account all future cash flows including the selling price, and it converts all these amounts to their present values using discount rate required by the investor. More information and an example on the blog.	$ 20,286
Internal Rate of Return Internal Rate of Return (IRR) Rate which an investment will return over the estimated period of ownership. It is in fact the discount rate that produces NPV of zero. Internal Rate of Return (IRR) Rate which an investment will return over the estimated period of ownership. It is in fact the discount rate that produces NPV of zero.	6.23 %
Profitability Index Profitability Index Similar to NPV, also calculates with the present values of future cash flows and discount rate. It shows whether the present value of the cash flows is worth the initial investment. Good investment should be above 1.0 Profitability Index Similar to NPV, also calculates with the present values of future cash flows and discount rate. It shows whether the present value of the cash flows is worth the initial investment. Good investment should be above 1.0	1.12
Annual Depreciation	$ 17,455

Holding period of 10 years and discount rate of 5.00% were used for calculation of NPV and IRR. The rest of the financial measures are for the 1st year only and therefore don't provide such an exact information.

Investment Return Ratios

Cash on Cash Return Cash on Cash Return Ratio between annual cash flow before taxes and the total initial investment, expressed as a percentage. It does not take in account the future value of money. Cash on Cash Return Ratio between annual cash flow before taxes and the total initial investment, expressed as a percentage. It does not take in account the future value of money.	-2.93 %
Return on Investment Return on Investment Very similar to Cash on Cash Return, but also takes in account appreciation of the property in the first year. Return on Investment Very similar to Cash on Cash Return, but also takes in account appreciation of the property in the first year.	7.94 %
Capitalization Rate Capitalization Rate Calculated as ratio of the net operating income and the value of the property. Capitalization Rate Calculated as ratio of the net operating income and the value of the property.	5.18 %
Gross Rental Yield Gross Rental Yield Used for a particular property or also as a market indicator when using median values of rent and house prices - counted from gross scheduled rent and initial investment. Gross Rental Yield Used for a particular property or also as a market indicator when using median values of rent and house prices - counted from gross scheduled rent and initial investment.	13.64 %
Gross Rent Multiplier Gross Rent Multiplier (GRM) Counted as a ratio of market value of the property and gross scheduled income. Gross Rent Multiplier (GRM) Counted as a ratio of market value of the property and gross scheduled income.	7.33

Financing
Down Payment		$ 150,000
Loan		$ 450,000
Loan to Value Ratio Loan to Value Ratio Shows sum of all purchase and rehab loans divided by purchase price. Loan to Value Ratio Shows sum of all purchase and rehab loans divided by purchase price.		75.00 %
Loan to Cost Ratio Loan to Cost Ratio Shows sum of all purchase and rehab loans to construction cost (purchase price + repairs). Loan to Cost Ratio Shows sum of all purchase and rehab loans to construction cost (purchase price + repairs).		74.38 %
Debt Coverage Ratio		0.86

Loan Financing of: Purchase price ($ 600,000)
Type	Amortized
Loan Amount	$ 450,000
Down payment (25%)	$ 150,000
Amortization	30 years
Interest Rate	7.00 %
Monthly Payment	$ 2,993.86

This chart shows the process of accumulation of investor's equity. There is some equity created right at the beginning with the rehab/construction and later investor's equity is rising by paying off the principal of the loan and also by appreciation over the years. All the green parts is the cummulative equity belonging to the investor and the red part belongs to the lender.

Year	0	1	2	3	4	5	6	7	8	9	10
Operational Analysis
Gross Scheduled Income	0	81,840	83,477	85,146	86,849	88,586	90,358	92,165	94,008	95,889	97,806
Vacancy Loss	0	4,092	4,174	4,257	4,342	4,429	4,518	4,608	4,700	4,794	4,890
Gross Operating Income	0	77,748	79,303	80,889	82,507	84,157	85,840	87,557	89,308	91,094	92,916
Expenses	0	46,675	47,609	48,561	49,532	50,523	51,533	52,564	53,615	54,687	55,781
Net Operating Income	0	31,073	31,694	32,328	32,975	33,634	34,307	34,993	35,693	36,407	37,135
Loan Payment	0	35,926	35,926	35,926	35,926	35,926	35,926	35,926	35,926	35,926	35,926
Payment Interest Part	0	31,355	31,025	30,670	30,290	29,883	29,446	28,978	28,475	27,937	27,359
Payment Principal Part	0	4,571	4,902	5,256	5,636	6,043	6,480	6,949	7,451	7,990	8,567
Cash Flow
Repairs/Construction	5,000	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-165,500	-4,854	-4,232	-3,598	-2,952	-2,292	-1,619	-933	-233	480	1,209
Depreciation	0	17,455	17,455	17,455	17,455	17,455	17,455	17,455	17,455	17,455	17,455
Taxes	0	-4,434	-4,196	-3,949	-3,693	-3,426	-3,149	-2,860	-2,559	-2,246	-1,920
Cash Flow After Taxes	-165,500	-419	-36	351	741	1,134	1,529	1,927	2,326	2,727	3,128

Note: All amounts in the table above are in $

Resale Price Evaluation Methods

The property is sold after 10 years. Below is the resale price calculated using different methods.

Gross Rent Multiplier	$ 716,921
Appreciation (3.00%)	$ 806,350
Cap Rate (5.18%) & NOI	$ 716,889

Sale Proceeds

Projected Selling Price	$ 716,921
Costs of Sale (6.00%)	$ 43,015
1. Loan Balance Payoff	$ 386,156
Net Sale Proceeds Before Tax	$ 287,750

In the resale analysis we do not include any calculation for taxes that might be owed on sale of the property. The tax laws for the resale are rather complex and subjected to frequent changes.

Net Assets and Yield

Net Assets
Sale Proceeds Before Tax	$ 287,750
Investor Cash Outlay	$ 165,500
Net Assets	$ 122,250
Average Yield
Annual Net Assets	$ 12,225
Average Cash Flow (After Taxes)	$ 1,028
Average Annual Gain (After Taxes)	$ 13,253
Average Annual Yield (After Taxes)	2.21 %

This charts shows Net Present Value (NPV) when property is sold in various years, i.e. when sold in 5th year, the NPV is calculated from 5 years of Cash Flow (including the selling price) and this NPV is displayed in year 5. Optimal holding period can be estimated, using this method - when NPV is the highest. Please note that appreciation growth can change these numbers greatly. It sometimes makes sense to sell the property even before the end of the mortgage term.

Property Report: 1433 SW Lincoln St, Topeka RENTAL

Property Report :

1433 SW Lincoln St, Topeka, KS 66604

Executive Summary