2450 NW 87th St, Miami FL 33147

2450 NW 87th St, Miami, FL 33147

Singlefamily: 4 bedrooms , 3.5 bathrooms

Year built: 2023,

Investment strategy: Rental Property

Purchase Price$ 699,000

Rent$ 4,350/mo

Monthly Cash Flow$ -977

Cash on Cash Return-7.98 %

Financial Analysis

Cash on Cash Return	-7.98 %
Internal Rate of Return (IRR)	8.98 %
Capitalization Rate	5.04 %
Gross Rent Multiplier (GRM)	13.39
Debt-coverage Ratio (DCR)	0.75
Operating Expense Ratio (OER)	29.76 %
After Repair Value	$ 699,000

Financial Breakdown

Purchase Price	$ 699,000
Purchase Costs	$ 6,990
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).	$ 705,990
Financing	$ 559,200
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 146,790
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.	$ 139,800
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.	$ 6,990

Operating Analysis

Rent	$ 4,350/mo
Gross Operating Income (GOI)	$ 50,112
Total Expenses	$ 14,912
Net Operating Income (NOI)	$ 35,200
Annual Debt Service	$ 46,920
Cash Flow Before Taxes (CFBT)	$ -11,720
Income Tax Liability	$ -6,725
Cash Flow After Taxes (CFAT)	$ -4,995

NEW CONSTRUCTION HOME 2700 SQUARE FEET WITH ONE CAR GARAGE. BEAUTIFUL HOME 4 BEDROOMS AND 3 BATHROOMS, NEW ROOF, TOP OF THE LINE APPLIANCES, LAUNDRY ROOM AND MORE.

Purchase Price	$ 699,000
Address	2450 NW 87th St , Miami, 33147, FL
MLS^® #	A11393112
Listing Agent	Aylin Cachon
Listing Broker	Miami New Realty
Year Built	2023
Type	Singlefamily
Bedrooms	4
Bathrooms	3.5

Property History

Date	Price	Change	Event
12/1/1981

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.	$ 52,200
Total Gross Income	$ 52,200
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.	$ 2,088
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.	$ 50,112	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	$ 5,011	10.00 %
Property tax	$ 6,757	13.48 %
Insurance	$ 3,144	6.27 %
Total Expenses	$ 14,912	29.76 %
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.	$ 35,200	70.24 %

Cash Flow (Year 1)

Net Operating Income	$ 35,200	70.24 %
Annual Debt Service	$ 46,920	93.63 %
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.	$ -11,720	-23.39 %
Income Tax Liability	$ -6,725	-13.42 %
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.	$ -4,995	-9.97 %

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).	29.76 %
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.	123.39 %

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.	$ 72,487
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.	8.98 %
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	1.49
Annual Depreciation	$ 20,335

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.	-7.98 %
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.	6.30 %
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.	5.04 %
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.	7.47 %
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.	13.39

Financing		% of ARV
Down Payment	$ 139,800	20.00 %
Loan	$ 559,200	80.00 %
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		0.75

Loan Financing of: Purchase price ($ 699,000)
Type	Amortized
Loan Amount	$ 559,200
Down payment (20%)	$ 139,800
Amortization	30 years
Interest Rate	7.50 %
Monthly Payment	$ 3,910.01

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	52,200	53,244	54,309	55,395	56,503	57,633	58,786	59,961	61,161	62,384
Vacancy Loss	0	2,088	2,130	2,172	2,216	2,260	2,305	2,351	2,398	2,446	2,495
Gross Operating Income	0	50,112	51,114	52,137	53,179	54,243	55,328	56,434	57,563	58,714	59,888
Expenses	0	14,912	15,210	15,515	15,825	16,141	16,464	16,794	17,129	17,472	17,821
Net Operating Income	0	35,200	35,904	36,622	37,354	38,101	38,863	39,641	40,433	41,242	42,067
Loan Payment	0	46,920	46,920	46,920	46,920	46,920	46,920	46,920	46,920	46,920	46,920
Payment Interest Part	0	41,765	41,365	40,934	40,469	39,968	39,429	38,847	38,220	37,545	36,817
Payment Principal Part	0	5,155	5,555	5,986	6,451	6,952	7,492	8,073	8,700	9,375	10,103
Cash Flow
Repairs/Construction	0	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-146,790	-11,720	-11,016	-10,298	-9,566	-8,819	-8,057	-7,279	-6,487	-5,678	-4,853
Depreciation	0	20,335	20,335	20,335	20,335	20,335	20,335	20,335	20,335	20,335	20,335
Taxes	0	-6,725	-6,449	-6,162	-5,862	-5,550	-5,225	-4,885	-4,530	-4,159	-3,771
Cash Flow After Taxes	-146,790	-4,995	-4,567	-4,137	-3,703	-3,268	-2,832	-2,394	-1,956	-1,519	-1,082

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%)	$ 939,398
Cap Rate (5.04%) & NOI	$ 834,663
Gross Rent Multiplier	$ 835,319

Sale Proceeds

Projected Selling Price	$ 939,398
Costs of Sale (6.00%)	$ 56,364
1. Loan Balance Payoff	$ 485,358
Net Sale Proceeds Before Tax	$ 397,677

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	$ 397,677
Investor Cash Outlay	$ 146,790
Net Assets	$ 250,887
Average Yield
Annual Net Assets	$ 25,089
Average Cash Flow (After Taxes)	$ -2,937
Average Annual Gain (After Taxes)	$ 22,152
Average Annual Yield (After Taxes)	3.17 %

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: 2450 NW 87th St, Miami RENTAL

Property Report :

2450 NW 87th St, Miami, FL 33147

Executive Summary