24456 New Haven Dr, Murrieta CA 92562

24456 New Haven Dr, Murrieta, CA 92562

Singlefamily: 3 bedrooms , 2 bathrooms

Year built: 1988, Size: 1370 SF

Investment strategy: Rental Property

Purchase Price$ 499,900

Rent$ 2,600/mo

Monthly Cash Flow$ 224

Cash on Cash Return2.54 %

Financial Analysis

Cash on Cash Return	2.54 %
Internal Rate of Return (IRR)	14.73 %
Capitalization Rate	4.59 %
Gross Rent Multiplier (GRM)	16.02
Debt-coverage Ratio (DCR)	1.13
Operating Expense Ratio (OER)	22.66 %

Financial Breakdown

Purchase Price	$ 499,900
Purchase Costs	$ 6,000
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).	$ 505,900
Financing	$ 399,920
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 105,980
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.	$ 99,980
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.	$ 6,000

Operating Analysis

Rent	$ 2,600/mo
Gross Operating Income (GOI)	$ 29,640
Total Expenses	$ 6,717
Net Operating Income (NOI)	$ 22,923
Annual Debt Service	$ 20,233
Cash Flow Before Taxes (CFBT)	$ 2,690
Income Tax Liability	$ -876
Cash Flow After Taxes (CFAT)	$ 3,566

BACK ON THE MARKET!!! Beautifully maintained single story home in the heart of Murrieta!!! This home offers an amazing shade tree in the front yard with well manicured green grass. As you enter the home you are welcomed by vaulted ceilings in the living area and a cozy fireplace. On the back side of the house you have the kitchen and sliding glass door to step into the backyard. Two bedrooms and one bathroom wrap the hallway as you walk back to the master bedroom with the master bathroom. The master bedroom also has a sliding glass door giving you assess to the backyard. The house sits in a well established neighborhood close to the freeway, award winning schools, and all the shopping you need. This one won't last so be sure to get your showing on the calendar!!!

Purchase Price	$ 499,900
Address	24456 New Haven Dr , Murrieta, 92562, CA
MLS^® #	SW21139753
Listing Agent	Joel Silverthorn
Listing Broker	Signature Real Estate Group
Year Built	1988
Type	Singlefamily
Size	1370 SF
Bedrooms	3
Bathrooms	2

Property History

Date	Price	Change	Event
6/27/1997
4/28/1989

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.	$ 31,200
Total Gross Income	$ 31,200
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.	$ 1,560
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.	$ 29,640	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	$ 1,800	6.07 %
Capex	$ 100	0.34 %
Repairs	$ 1,200	4.05 %
Property tax	$ 2,117	7.14 %
Insurance	$ 1,500	5.06 %
Total Expenses	$ 6,717	22.66 %
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.	$ 22,923	77.34 %

Cash Flow (Year 1)

Net Operating Income	$ 22,923	77.34 %
Annual Debt Service	$ 20,233	68.26 %
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.	$ 2,690	9.08 %
Income Tax Liability	$ -876	-2.95 %
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.	$ 3,566	12.03 %

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).	22.66 %
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.	90.92 %

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.	$ 131,892
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.	14.73 %
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	2.24
Annual Depreciation	$ 14,543

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.	2.54 %
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.	16.69 %
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.	4.59 %
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.	6.24 %
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.	16.02

Financing
Down Payment		$ 99,980
Loan		$ 399,920
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.		80.00 %
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).		80.00 %
Debt Coverage Ratio		1.13

Loan Financing of: Purchase price ($ 499,900)
Type	Amortized
Loan Amount	$ 399,920
Down payment (20%)	$ 99,980
Amortization	30 years
Interest Rate	3.00 %
Monthly Payment	$ 1,686.08

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	31,200	31,824	32,460	33,110	33,772	34,447	35,136	35,839	36,556	37,287
Vacancy Loss	0	1,560	1,591	1,623	1,655	1,689	1,722	1,757	1,792	1,828	1,864
Gross Operating Income	0	29,640	30,233	30,837	31,454	32,083	32,725	33,379	34,047	34,728	35,423
Expenses	0	6,717	6,851	6,988	7,128	7,271	7,416	7,564	7,716	7,870	8,027
Net Operating Income	0	22,923	23,381	23,849	24,326	24,813	25,309	25,815	26,331	26,858	27,395
Loan Payment	0	20,233	20,233	20,233	20,233	20,233	20,233	20,233	20,233	20,233	20,233
Payment Interest Part	0	11,883	11,629	11,368	11,098	10,820	10,534	10,239	9,935	9,622	9,299
Payment Principal Part	0	8,350	8,603	8,865	9,135	9,413	9,699	9,994	10,298	10,611	10,934
Cash Flow
Repairs/Construction	0	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-105,980	2,690	3,149	3,616	4,093	4,580	5,076	5,582	6,098	6,625	7,162
Depreciation	0	14,543	14,543	14,543	14,543	14,543	14,543	14,543	14,543	14,543	14,543
Taxes	0	-876	-698	-515	-329	-138	58	258	463	673	888
Cash Flow After Taxes	-105,980	3,566	3,846	4,132	4,422	4,717	5,018	5,324	5,635	5,952	6,274

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.

Appreciation (3.00%)	$ 671,824
Cap Rate (4.59%) & NOI	$ 596,844
Gross Rent Multiplier	$ 597,336

Sale Proceeds

Projected Selling Price	$ 671,824
Costs of Sale (6.00%)	$ 40,309
1. Loan Balance Payoff	$ 304,018
Net Sale Proceeds Before Tax	$ 327,496

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	$ 327,496
Investor Cash Outlay	$ 105,980
Net Assets	$ 221,516
Average Yield
Annual Net Assets	$ 22,152
Average Cash Flow (After Taxes)	$ 4,261
Average Annual Gain (After Taxes)	$ 26,413
Average Annual Yield (After Taxes)	5.28 %

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: 24456 New Haven Dr, Murrieta RENTAL

Property Report :

24456 New Haven Dr, Murrieta, CA 92562

Executive Summary