28 Valley Pond Rd, Katonah NY 10536

28 Valley Pond Rd, Katonah, NY 10536

Singlefamily: 8 rooms: 4 bedrooms , 2 bathrooms

Year built: 1975, Size: 2176 SF

Investment strategy: Rental Property

Cozy house on Valley Pond

Purchase Price$ 518,000

Rent$ 2,450/mo

Monthly Cash Flow$ 1,225

Cash on Cash Return2.84 %

Financial Analysis

Cash on Cash Return	2.84 %
Internal Rate of Return (IRR)	5.12 %
Capitalization Rate	2.84 %
Gross Rent Multiplier (GRM)	17.62
Debt-coverage Ratio (DCR)	0.00
Operating Expense Ratio (OER)	50.00 %

Financial Breakdown

Purchase Price	$ 518,000
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).	$ 518,000
Financing	$ 0
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 518,000
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.	$ 518,000

Operating Analysis

Rent	$ 2,450/mo
Gross Operating Income (GOI)	$ 29,400
Total Expenses	$ 14,700
Net Operating Income (NOI)	$ 14,700
Annual Debt Service	$ 0
Cash Flow Before Taxes (CFBT)	$ 14,700
Income Tax Liability	$ -92
Cash Flow After Taxes (CFAT)	$ 14,792

On Valley Pond - Enjoy the ever-changing natural landscape - a place to play, fish, boat or simply daydream. This solid 4 BR Center Hall Colonial is set on a lovely and level 2 acre parcel with its own spring-fed pond, adjacent to Valley Pond. Wood floors grace the entire home along with an updated granite kitchen, updated baths, a spacious & sunlit family room w/ fireplace and vaulted ceiling with sliders that lead out to an oversized trex deck - perfect for BBQs, parties and entertaining of all types. The upstairs features a large master bedroom w/walk-in closet, hall bath and 3 nicely proportioned bedrooms. All systems have been lovingly maintained and updated along with energy-efficient solar panels which generate more electric than used! An unfinished lower level leads out to the 2 Car garage with plenty of storage. There is room to run, play ball, garden and relax in the spacious back yard with no better location in town where you're literally a stone's throw from all 4 Somers Schools, Reis Park, library, shopping & minutes to Metro North and Highways. Taxes do not reflect STAR of $1,701 for those who qualify.

Purchase Price	$ 518,000
Address	28 Valley Pond Rd , Katonah, 10536, NY
Year Built	1975
Type	Singlefamily
Size	2176 SF
Bedrooms	4
Bathrooms	2
Rooms Total	8

28 Valley Pond Rd Katonah, NY 10536

Singlefamily

Bldg type
2,176

SqFt
4

Beds
2

Baths

#	Property address	Distance	Beds	Baths	SqFt	Date sold	Sale price	$/SqFt
1	4 Appian Ln	0.5mi	4	3.0	3,034	06/05/2019	$ 610,000	$ 201
2	9 Florence Dr	1.8mi	4	3.0	2,078	12/20/2019	$ 480,000	$ 231
Average:							$ 545,000	$ 216

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.	$ 29,400
Total Gross Income	$ 29,400
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.	$ 0
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.	$ 29,400	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).
50% rule	$ 14,700	50.00 %
Total Expenses	$ 14,700	50.00 %
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.	$ 14,700	50.00 %

Cash Flow (Year 1)

Net Operating Income	$ 14,700	50.00 %
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.	$ 14,700	50.00 %
Income Tax Liability	$ -92	-0.31 %
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.	$ 14,792	50.31 %

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).	50.00 %
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.	50.00 %

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.	$ 5,301
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.	5.12 %
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	1.01
Annual Depreciation	$ 15,069

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.	2.84 %
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.	5.84 %
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.	2.84 %
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.	5.68 %
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.	17.62

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	29,400	29,988	30,588	31,200	31,824	32,460	33,109	33,771	34,447	35,136
Vacancy Loss	0	0	0	0	0	0	0	0	0	0	0
Gross Operating Income	0	29,400	29,988	30,588	31,200	31,824	32,460	33,109	33,771	34,447	35,136
Expenses	0	14,700	14,994	15,294	15,600	15,912	16,230	16,555	16,886	17,223	17,568
Net Operating Income	0	14,700	14,994	15,294	15,600	15,912	16,230	16,555	16,886	17,223	17,568
Cash Flow
Repairs/Construction	0	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-518,000	14,700	14,994	15,294	15,600	15,912	16,230	16,555	16,886	17,223	17,568
Depreciation	0	15,069	15,069	15,069	15,069	15,069	15,069	15,069	15,069	15,069	15,069
Taxes	0	-92	-19	56	133	211	290	371	454	539	625
Cash Flow After Taxes	-518,000	14,792	15,013	15,238	15,467	15,701	15,940	16,183	16,432	16,685	16,943

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%)	$ 696,149
Cap Rate (2.84%) & NOI	$ 618,587
Gross Rent Multiplier	$ 619,092

Sale Proceeds

Projected Selling Price	$ 696,149
Costs of Sale (6.00%)	$ 41,769
Net Sale Proceeds Before Tax	$ 654,380

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	$ 654,380
Investor Cash Outlay	$ 518,000
Net Assets	$ 136,380
Average Yield
Annual Net Assets	$ 13,638
Average Cash Flow (After Taxes)	$ 14,145
Average Annual Gain (After Taxes)	$ 27,783
Average Annual Yield (After Taxes)	5.36 %

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.

There is no financing selected in this deal.

Property Report: 28 Valley Pond Rd, Katonah RENTAL

Property Report :

28 Valley Pond Rd, Katonah, NY 10536

Executive Summary