326 N Hamlin Ave Unit 3S, Chicago IL 60624

326 N Hamlin Ave Unit 3S, Chicago, IL 60624

Condominium: 3 bedrooms , 2 bathrooms

Year built: 2002, Size: 1400 SF

Investment strategy: Rental Property

Purchase Price$ 429,900

Rent$ 5,210/mo

Monthly Cash Flow$ 643

Cash on Cash Return11.97 %

Financial Analysis

Cash on Cash Return	11.97 %
Internal Rate of Return (IRR)	25.51 %
Capitalization Rate	7.27 %
Gross Rent Multiplier (GRM)	6.88
Debt-coverage Ratio (DCR)	1.33
Operating Expense Ratio (OER)	50.00 %

Financial Breakdown

Purchase Price	$ 429,900
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).	$ 429,900
Financing	$ 365,415
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 64,485
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.	$ 64,485
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.	$ 0

Operating Analysis

Rent	$ 5,210/mo
Gross Operating Income (GOI)	$ 62,520
Total Expenses	$ 31,260
Net Operating Income (NOI)	$ 31,260
Annual Debt Service	$ 23,540
Cash Flow Before Taxes (CFBT)	$ 7,720
Income Tax Liability	$ 151
Cash Flow After Taxes (CFAT)	$ 7,569

Incredible Opportunity To Own A Top Floor Modern Spacious Condo In The West Garfield Park Neighborhood. These Condos Feature A Spacious Primary Bedroom, With Its Own Individual Bathroom. Open Concept Kitchen, Living Room & Dining Room Combo With A Parking Space Included. Solid Tenant In Place, Seller Owns Other Units In The Building & Is Willing To Sell As A Package Deal. Schedule Your Private Showing Today Before This Unit Sells!

Purchase Price	$ 429,900
Address	326 N Hamlin Ave Unit 3S , Chicago, 60624, IL
MLS^® #	11453906
Listing Agent	Gaspar Flores Jr
Listing Broker	Su Familia Real Estate Inc
Year Built	2002
Type	Condominium
Size	1400 SF
Bedrooms	3
Bathrooms	2

Property History

Date	Price	Change	Event
12/23/2014
10/22/2008
7/9/2008

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.	$ 62,520
Total Gross Income	$ 62,520
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.	$ 62,520	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	$ 31,260	50.00 %
Total Expenses	$ 31,260	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.	$ 31,260	50.00 %

Cash Flow (Year 1)

Net Operating Income	$ 31,260	50.00 %
Annual Debt Service	$ 23,540	37.65 %
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.	$ 7,720	12.35 %
Income Tax Liability	$ 151	0.24 %
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.	$ 7,569	12.11 %

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.	87.65 %

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.	$ 75,768
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.	25.51 %
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	2.17
Annual Depreciation	$ 12,506

Holding period of 5 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.	11.97 %
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.	31.97 %
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.	7.27 %
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.	14.54 %
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.	6.88

Financing
Down Payment		$ 64,485
Loan		$ 365,415
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.		85.00 %
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).		85.00 %
Debt Coverage Ratio		1.33

Loan Financing of: Purchase price ($ 429,900)
Type	Amortized
Loan Amount	$ 365,415
Down payment (15%)	$ 64,485
Amortization	30 years
Interest Rate	5.00 %
Monthly Payment	$ 1,961.63

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
Operational Analysis
Gross Scheduled Income	0	62,520	63,770	65,046	66,347	67,674
Vacancy Loss	0	0	0	0	0	0
Gross Operating Income	0	62,520	63,770	65,046	66,347	67,674
Expenses	0	31,260	31,885	32,523	33,173	33,837
Net Operating Income	0	31,260	31,885	32,523	33,173	33,837
Loan Payment	0	23,540	23,540	23,540	23,540	23,540
Payment Interest Part	0	18,148	17,872	17,583	17,278	16,957
Payment Principal Part	0	5,391	5,667	5,957	6,262	6,582
Cash Flow
Repairs/Construction	0	0	0	0	0	0
Cash Flow Before Taxes	-64,485	7,720	8,346	8,983	9,634	10,297
Depreciation	0	12,506	12,506	12,506	12,506	12,506
Taxes	0	151	377	609	847	1,093
Cash Flow After Taxes	-64,485	7,569	7,969	8,375	8,786	9,204

Note: All amounts in the table above are in $

Resale Price Evaluation Methods

The property is sold after 5 years. Below is the resale price calculated using different methods.

Appreciation (3.00%)	$ 498,372
Cap Rate (7.27%) & NOI	$ 465,431
Gross Rent Multiplier	$ 465,595

Sale Proceeds

Projected Selling Price	$ 498,372
Costs of Sale (6.00%)	$ 29,902
1. Loan Balance Payoff	$ 335,556
Net Sale Proceeds Before Tax	$ 132,914

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	$ 132,914
Investor Cash Outlay	$ 64,485
Net Assets	$ 68,429
Average Yield
Annual Net Assets	$ 13,686
Average Cash Flow (After Taxes)	$ 6,540
Average Annual Gain (After Taxes)	$ 20,226
Average Annual Yield (After Taxes)	4.70 %

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: 326 N Hamlin Ave Unit 3S, Chicago RENTAL

Property Report :

326 N Hamlin Ave Unit 3S, Chicago, IL 60624

Executive Summary