395 Grant Ave, Macon GA 31201

395 Grant Ave, Macon, GA 31201

Singlefamily: 4 bedrooms , 1.5 bathrooms

Year built: 1960, Size: 2947 SF

Investment strategy: Rental Property

Purchase Price$ 74,496

Rent$ 950/mo

Monthly Cash Flow$ 931

Cash on Cash Return12.08 %

Financial Analysis

Cash on Cash Return	12.08 %
Internal Rate of Return (IRR)	14.71 %
Capitalization Rate	11.40 %
Gross Rent Multiplier (GRM)	8.60
Debt-coverage Ratio (DCR)	0.00
Operating Expense Ratio (OER)	0.00 %
After Repair Value	$ 98,000
Profit/Equity From Rehab	$ 5,504

Financial Breakdown

Purchase Price	$ 74,496
Purchase Costs	$ 3,000
Repair/Construction Costs	$ 15,000
Total Capital Needed Total Capital Needed Includes all projects costs (except selling costs). Total Capital Needed Includes all projects costs (except selling costs).	$ 92,496
Financing	$ 0
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 92,496
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.	$ 92,496

Operating Analysis

Rent	$ 950/mo
Gross Operating Income (GOI)	$ 11,172
Total Expenses	$ 0
Net Operating Income (NOI)	$ 11,172
Annual Debt Service	$ 0
Cash Flow Before Taxes (CFBT)	$ 11,172
Income Tax Liability	$ 2,251
Cash Flow After Taxes (CFAT)	$ 8,921

Purchase Price	$ 74,496
Address	395 Grant Ave , Macon, 31201, GA
Year Built	1960
Type	Singlefamily
Size	2947 SF
Bedrooms	4
Bathrooms	1.5

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.	$ 11,400
Total Gross Income	$ 11,400
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.	$ 228
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.	$ 11,172	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).
Total Expenses	$ 0	0.00 %
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.	$ 11,172	100.00 %

Cash Flow (Year 1)

Net Operating Income	$ 11,172	100.00 %
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.	$ 11,172	100.00 %
Income Tax Liability	$ 2,251	20.15 %
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.	$ 8,921	79.85 %

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).	0.00 %
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.	0.00 %

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.	$ 277,652
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.	14.71 %
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	4.00
Annual Depreciation	$ 2,167

Holding period of 30 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.	12.08 %
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.	16.91 %
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.	11.40 %
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.	15.30 %
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.	8.60

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	11	12	13	14	15	16	17	18	19	20	21	22	23	24	25	26	27	28	29	30
Operational Analysis
Gross Scheduled Income	0	11,400	11,970	12,569	13,197	13,857	14,550	15,277	16,041	16,843	17,685	18,569	19,498	20,473	21,496	22,571	23,700	24,885	26,129	27,435	28,807	30,248	31,760	33,348	35,015	36,766	38,604	40,535	42,561	44,689	46,924
Vacancy Loss	0	228	239	251	264	277	291	306	321	337	354	371	390	409	430	451	474	498	523	549	576	605	635	667	700	735	772	811	851	894	939
Gross Operating Income	0	11,172	11,731	12,317	12,933	13,580	14,259	14,972	15,720	16,506	17,331	18,198	19,108	20,063	21,066	22,120	23,226	24,387	25,606	26,887	28,231	29,643	31,125	32,681	34,315	36,031	37,832	39,724	41,710	43,796	45,985
Expenses	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
Net Operating Income	0	11,172	11,731	12,317	12,933	13,580	14,259	14,972	15,720	16,506	17,331	18,198	19,108	20,063	21,066	22,120	23,226	24,387	25,606	26,887	28,231	29,643	31,125	32,681	34,315	36,031	37,832	39,724	41,710	43,796	45,985
Cash Flow
Repairs/Construction	15,000	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-92,496	11,172	11,731	12,317	12,933	13,580	14,259	14,972	15,720	16,506	17,331	18,198	19,108	20,063	21,066	22,120	23,226	24,387	25,606	26,887	28,231	29,643	31,125	32,681	34,315	36,031	37,832	39,724	41,710	43,796	45,985
Depreciation	0	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167	2,167
Taxes	0	2,251	2,391	2,538	2,692	2,853	3,023	3,201	3,388	3,585	3,791	4,008	4,235	4,474	4,725	4,988	5,265	5,555	5,860	6,180	6,516	6,869	7,239	7,629	8,037	8,466	8,916	9,389	9,886	10,407	10,955
Cash Flow After Taxes	-92,496	8,921	9,340	9,780	10,241	10,726	11,236	11,770	12,332	12,921	13,540	14,190	14,873	15,589	16,342	17,132	17,961	18,832	19,747	20,707	21,715	22,774	23,885	25,053	26,278	27,565	28,916	30,335	31,824	33,388	35,031

Note: All amounts in the table above are in $

Resale Price Evaluation Methods

The property is sold after 30 years. Below is the resale price calculated using different methods.

Appreciation (6.00%)	$ 562,862
Cap Rate (11.40%) & NOI	$ 403,381
Gross Rent Multiplier	$ 403,546

Sale Proceeds

Projected Selling Price	$ 562,862
Costs of Sale (6.00%)	$ 33,772
Net Sale Proceeds Before Tax	$ 529,090

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	$ 529,090
Investor Cash Outlay	$ 92,496
Net Assets	$ 436,594
Average Yield
Annual Net Assets	$ 14,553
Average Cash Flow (After Taxes)	$ 17,930
Average Annual Gain (After Taxes)	$ 32,484
Average Annual Yield (After Taxes)	43.60 %

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: 395 Grant Ave, Macon RENTAL

Property Report :

395 Grant Ave, Macon, GA 31201

Executive Summary