Harlingen Multi Units- Valencia: 2129 Multi National, Harlingen TX 78550

2129 Multi National, Harlingen, TX 78550

Multifamily:

Year built: 2021, Size: 3320 SF

Investment strategy: Rental Property

Purchase Price$ 395,000

Rent$ 4,400/mo

Monthly Cash Flow$ 3,614

Cash on Cash Return10.98 %

Financial Analysis

Cash on Cash Return	10.98 %
Internal Rate of Return (IRR)	10.78 %
Capitalization Rate	10.98 %
Gross Rent Multiplier (GRM)	7.48
Debt-coverage Ratio (DCR)	0.00
Operating Expense Ratio (OER)	15.32 %

Financial Breakdown

Purchase Price	$ 395,000
Purchase Costs	$ 0
Repair/Construction Costs	$ 0
Total Capital Needed Total Capital Needed Includes all projects costs (except selling costs). Total Capital Needed Includes all projects costs (except selling costs).	$ 395,000
Financing	$ 0
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 395,000
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.	$ 0
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.	$ 395,000

Operating Analysis

Rent	$ 4,400/mo
Gross Operating Income (GOI)	$ 51,216
Total Expenses	$ 7,846
Net Operating Income (NOI)	$ 43,370
Annual Debt Service	$ 0
Cash Flow Before Taxes (CFBT)	$ 43,370
Income Tax Liability	$ 7,970
Cash Flow After Taxes (CFAT)	$ 35,400

New Fourplex coming soon! Blocks away from the expressway! Excellent option for Investors or even first time home buyers! You read that right, live in one unit and lease the other three! Each unit features 2 bedrooms, 2 baths with ceramic tile floors, walk-in closets, private patios and granite countertops. Construction will start soon, reserve yours today! Additional lots available.

Purchase Price	$ 395,000
Address	2129 Multi National , Harlingen, 78550, TX
MLS^® #	374401
Listing Agent	Patricia Baez REALTOR
Listing Broker	The Firm Real Estate Co. Llc
Year Built	2021
Type	Multifamily
Number of Units
Size	3320 SF

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.	$ 52,800
	$ 0
Total Gross Income	$ 52,800
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.	$ 1,584
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.	$ 51,216	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).
Water	$ 1,800	3.51 %
Insurance	$ 2,500	4.88 %
Property tax	$ 3,270	6.38 %
Association fees Valencia HOA	$ 276	0.54 %
Total Expenses	$ 7,846	15.32 %
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.	$ 43,370	84.68 %

Cash Flow (Year 1)

Net Operating Income	$ 43,370	84.68 %
Annual Debt Service	$ 0	0.00 %
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.	$ 43,370	84.68 %
Income Tax Liability	$ 7,970	15.56 %
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.	$ 35,400	69.12 %

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).	15.32 %
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.	15.32 %

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.	$ 189,791
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.	10.78 %
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	1.48
Annual Depreciation	$ 11,491

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.	10.98 %
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.	13.98 %
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.	10.98 %
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.	13.37 %
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.	7.48

There is no financing selected in this deal.

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	52,800	53,856	54,933	56,032	57,152	58,295	59,461	60,651	61,864	63,101
Vacancy Loss	0	1,584	1,616	1,648	1,681	1,715	1,749	1,784	1,820	1,856	1,893
Gross Operating Income	0	51,216	52,240	53,285	54,351	55,438	56,547	57,678	58,831	60,008	61,208
Expenses	0	7,846	8,003	8,163	8,326	8,493	8,663	8,836	9,013	9,193	9,377
Net Operating Income	0	43,370	44,237	45,122	46,025	46,945	47,884	48,842	49,819	50,815	51,831
Cash Flow
Repairs/Construction	0	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-395,000	43,370	44,237	45,122	46,025	46,945	47,884	48,842	49,819	50,815	51,831
Depreciation	0	11,491	11,491	11,491	11,491	11,491	11,491	11,491	11,491	11,491	11,491
Taxes	0	7,970	8,187	8,408	8,633	8,864	9,098	9,338	9,582	9,831	10,085
Cash Flow After Taxes	-395,000	35,400	36,051	36,714	37,391	38,082	38,786	39,504	40,237	40,984	41,746

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	$ 471,995
Appreciation (3.00%)	$ 530,847
Cap Rate (10.98%) & NOI	$ 472,051

Sale Proceeds

Projected Selling Price	$ 471,995
Costs of Sale (0.00%)	$ 0
Net Sale Proceeds Before Tax	$ 471,995

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	$ 471,995
Investor Cash Outlay	$ 395,000
Net Assets	$ 76,995
Average Yield
Annual Net Assets	$ 7,700
Average Cash Flow (After Taxes)	$ 34,315
Average Annual Gain (After Taxes)	$ 42,014
Average Annual Yield (After Taxes)	10.64 %

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: Harlingen Multi Units- Valencia RENTAL

Property Report :

Harlingen Multi Units- Valencia

2129 Multi National, Harlingen, TX 78550

Executive Summary

2129 Multi National, Harlingen, TX 78550

Financial Analysis

Financial Breakdown

Total Capital Needed

Total Capital Needed

Cash out of Pocket

Cash out of Pocket

Cash at Closing

Cash at Closing

Cash During Rehab

Cash During Rehab

Operating Analysis

Property Description

Operating Analysis

Annual Property Operating Data

Gross Scheduled Income (GSI)

Gross Scheduled Income (GSI)

Vacancy and Credit Loss

Vacancy and Credit Loss

Gross Operating Income (GOI)

Gross Operating Income (GOI)

Operating Expenses

Operating Expenses

Net Operating Income (NOI)

Net Operating Income (NOI)

Cash Flow (Year 1)

Cash Flow

Cash Flow

Cash Flow

Cash Flow

Operating Ratios

Operating Expense Ratio

Operating Expense Ratio

Break-Even Ratio (BER)

Break-Even Ratio (BER)

Financial Analysis

Financial Measures

Net Present Value (NPV)

Net Present Value (NPV)

Internal Rate of Return (IRR)

Internal Rate of Return (IRR)

Profitability Index

Profitability Index

Investment Return Ratios

Cash on Cash Return

Cash on Cash Return

Return on Investment

Return on Investment

Capitalization Rate

Capitalization Rate

Gross Rental Yield

Gross Rental Yield

Gross Rent Multiplier (GRM)

Gross Rent Multiplier (GRM)

Financing Overview

Long-term Cash Flow Forecast

Resale Analysis

Resale Price Evaluation Methods

Sale Proceeds

Net Assets and Yield

Photos