30 White Swan Dr, Narragansett RI 02882

30 White Swan Dr, Narragansett, RI 02882

Singlefamily: 8 rooms: 4 bedrooms , 3 bathrooms

Year built: 1984, Size: 2580 SF

Investment strategy: Rental Property

Purchase Price$ 750,000

Rent$ 5,000/mo

Monthly Cash Flow$ -296

Cash on Cash Return-2.25 %

Financial Analysis

Cash on Cash Return	-2.25 %
Internal Rate of Return (IRR)	12.28 %
Capitalization Rate	4.00 %
Gross Rent Multiplier (GRM)	12.50
Debt-coverage Ratio (DCR)	0.89
Operating Expense Ratio (OER)	50.00 %

Financial Breakdown

Purchase Price	$ 750,000
Purchase Costs	$ 7,500
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).	$ 757,500
Financing	$ 600,000
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 157,500
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.	$ 150,000
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.	$ 7,500

Operating Analysis

Rent	$ 5,000/mo
Gross Operating Income (GOI)	$ 60,000
Total Expenses	$ 30,000
Net Operating Income (NOI)	$ 30,000
Annual Debt Service	$ 33,549
Cash Flow Before Taxes (CFBT)	$ -3,549
Income Tax Liability	$ -3,607
Cash Flow After Taxes (CFAT)	$ 58

Live the good life in this welcoming 4 BR / 3 BA home in the Village at Point Judith one block from Ocean Road. Great floor plan with room and privacy for everyone - - bright living/dining area, large wrap-around deck, renovated open kitchen, master bedroom w. full bath and private deck, guest room with direct access to 2nd full bath. Lower level features large front-to-back family room w. wet bar and sliding glass doors to patio, two more large bedrooms and a 3rd full bath. Recent upgrades: replaced kitchen, ductless AC system, Anderson sliding glass doors on both levels, and freshly-painted exterior. Large fenced yard with fruit trees and shed for additional storage. Same family owned and occupied for the past 5 years. Three sandy beaches within walking distance (Roger Wheeler State Beach 0.5 miles, Salty Brine Beach 1.2 miles, Scarborough Beach 1.5 miles). Short ride to Narragansett Town Beach and Pier area. Walk to dining & entertainment: Iggy's, The Spain, and Chair 5. Ideal property for year-round family home, treasured seasonal family retreat, or as a high-performing investment property.

Purchase Price	$ 750,000
Address	30 White Swan Dr , Narragansett, 02882, RI
MLS^® #	1289896
Listing Agent	Bruce A Cutting
Listing Broker	RE/MAX FLAGSHIP, INC.
Year Built	1984
Type	Singlefamily
Size	2580 SF
Bedrooms	4
Bathrooms	3
Rooms Total	8

Property History

Date	Price	Change	Event
1/15/2021
7/14/2017

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.	$ 60,000
Total Gross Income	$ 60,000
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.	$ 60,000	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	$ 30,000	50.00 %
Total Expenses	$ 30,000	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.	$ 30,000	50.00 %

Cash Flow (Year 1)

Net Operating Income	$ 30,000	50.00 %
Annual Debt Service	$ 33,549	55.91 %
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.	$ -3,549	-5.91 %
Income Tax Liability	$ -3,607	-6.01 %
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.	$ 58	0.10 %

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.	105.91 %

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.	$ 147,681
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.	12.28 %
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	1.94
Annual Depreciation	$ 21,818

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.	-2.25 %
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.	12.03 %
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.	4.00 %
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.	8.00 %
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.	12.50

Financing
Down Payment		$ 150,000
Loan		$ 600,000
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.		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		0.89

Loan Financing of: Purchase price ($ 750,000)
Type	Amortized
Loan Amount	$ 600,000
Down payment (20%)	$ 150,000
Amortization	30 years
Interest Rate	3.80 %
Monthly Payment	$ 2,795.74

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	60,000	61,200	62,424	63,672	64,946	66,245	67,570	68,921	70,300	71,706
Vacancy Loss	0	0	0	0	0	0	0	0	0	0	0
Gross Operating Income	0	60,000	61,200	62,424	63,672	64,946	66,245	67,570	68,921	70,300	71,706
Expenses	0	30,000	30,600	31,212	31,836	32,473	33,122	33,785	34,461	35,150	35,853
Net Operating Income	0	30,000	30,600	31,212	31,836	32,473	33,122	33,785	34,461	35,150	35,853
Loan Payment	0	33,549	33,549	33,549	33,549	33,549	33,549	33,549	33,549	33,549	33,549
Payment Interest Part	0	22,611	22,188	21,749	21,292	20,818	20,326	19,815	19,284	18,732	18,159
Payment Principal Part	0	10,938	11,361	11,800	12,257	12,731	13,223	13,734	14,265	14,817	15,390
Cash Flow
Repairs/Construction	0	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-157,500	-3,549	-2,949	-2,337	-1,713	-1,076	-427	236	912	1,601	2,304
Depreciation	0	21,818	21,818	21,818	21,818	21,818	21,818	21,818	21,818	21,818	21,818
Taxes	0	-3,607	-3,351	-3,089	-2,818	-2,541	-2,255	-1,962	-1,660	-1,350	-1,031
Cash Flow After Taxes	-157,500	58	403	752	1,106	1,465	1,829	2,198	2,572	2,951	3,335

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%)	$ 1,007,937
Cap Rate (4.00%) & NOI	$ 896,320
Gross Rent Multiplier	$ 896,320

Sale Proceeds

Projected Selling Price	$ 1,007,937
Costs of Sale (6.00%)	$ 60,476
1. Loan Balance Payoff	$ 469,483
Net Sale Proceeds Before Tax	$ 477,977

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	$ 477,977
Investor Cash Outlay	$ 157,500
Net Assets	$ 320,477
Average Yield
Annual Net Assets	$ 32,048
Average Cash Flow (After Taxes)	$ 1,333
Average Annual Gain (After Taxes)	$ 33,381
Average Annual Yield (After Taxes)	4.45 %

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: 30 White Swan Dr, Narragansett RENTAL

Property Report :

30 White Swan Dr, Narragansett, RI 02882

Executive Summary