5403 Bracken Dr, Indianapolis IN 46239

5403 Bracken Dr, Indianapolis, IN 46239

Singlefamily: 4 bedrooms , 2.5 bathrooms

Year built: 1999, Size: 2082 SF

Investment strategy: Rental Property

Purchase Price$ 259,900

Rent$ 1,650/mo

Monthly Cash Flow$ 136

Cash on Cash Return3.15 %

Financial Analysis

Cash on Cash Return	3.15 %
Internal Rate of Return (IRR)	8.59 %
Capitalization Rate	5.21 %
Gross Rent Multiplier (GRM)	13.13
Debt-coverage Ratio (DCR)	1.14
Operating Expense Ratio (OER)	23.97 %

Financial Breakdown

Purchase Price	$ 259,900
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).	$ 259,900
Financing	$ 207,920
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 51,980
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.	$ 51,980
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	$ 1,650/mo
Gross Operating Income (GOI)	$ 17,820
Total Expenses	$ 4,272
Net Operating Income (NOI)	$ 13,548
Annual Debt Service	$ 11,912
Cash Flow Before Taxes (CFBT)	$ 1,636
Income Tax Liability	$ -1,132
Cash Flow After Taxes (CFAT)	$ 2,768

Welcome home to this Wildcat Run beauty! This 4 bedroom, 2.5 bath house has new carpet and fresh paint and is ready for it's second owner. Walk in to a spacious front room that can be used as an office/sitting room/play room, then continue on the the living room, eat in kitchen and adorable kitchen. Head outside to the completely private, fenced in backyard to enjoy sitting on your patio. The 9 x 12 shed has electricity. Upstairs will not disappoint as the master bath has been remodeled and will leave you wanting to live in the bathtub! The HVAC was replaced in 2015.

Purchase Price	$ 259,900
Address	5403 Bracken Dr , Indianapolis, 46239, IN
MLS^® #	21804618
Listing Agent	Missy Mendoza
Listing Broker	CENTURY 21 Scheetz
Year Built	1999
Type	Singlefamily
Size	2082 SF
Bedrooms	4
Bathrooms	2.5

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.	$ 19,800
Total Gross Income	$ 19,800
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.	$ 1,980
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.	$ 17,820	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	$ 948	5.32 %
Association fees	$ 324	1.82 %
Property tax	$ 1,728	9.70 %
Insurance	$ 1,272	7.14 %
Total Expenses	$ 4,272	23.97 %
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.	$ 13,548	76.03 %

Cash Flow (Year 1)

Net Operating Income	$ 13,548	76.03 %
Annual Debt Service	$ 11,912	66.84 %
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.	$ 1,636	9.18 %
Income Tax Liability	$ -1,132	-6.35 %
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.	$ 2,768	15.53 %

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).	23.97 %
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.	90.82 %

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.	$ 56,554
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.	8.59 %
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	2.09
Annual Depreciation	$ 7,561

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.	3.15 %
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.	8.15 %
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.	5.21 %
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.	7.62 %
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.	13.13

Financing
Down Payment		$ 51,980
30y		$ 207,920
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		1.14

30y Financing of: Purchase price ($ 259,900)
Type	Amortized
Loan Amount	$ 207,920
Down payment (20%)	$ 51,980
Amortization	30 years
Interest Rate	4.00 %
Monthly Payment	$ 992.64

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	19,800	19,998	20,198	20,400	20,604	20,810	21,018	21,228	21,441	21,655	21,872	22,090	22,311	22,534	22,760	22,987	23,217	23,449	23,684	23,921	24,160	24,401	24,645	24,892	25,141	25,392	25,646	25,903	26,162	26,423
Vacancy Loss	0	1,980	2,000	2,020	2,040	2,060	2,081	2,102	2,123	2,144	2,166	2,187	2,209	2,231	2,253	2,276	2,299	2,322	2,345	2,368	2,392	2,416	2,440	2,465	2,489	2,514	2,539	2,565	2,590	2,616	2,642
Gross Operating Income	0	17,820	17,998	18,178	18,360	18,544	18,729	18,916	19,105	19,297	19,489	19,684	19,881	20,080	20,281	20,484	20,688	20,895	21,104	21,315	21,529	21,744	21,961	22,181	22,403	22,627	22,853	23,081	23,312	23,545	23,781
Expenses	0	4,272	4,357	4,445	4,533	4,624	4,717	4,811	4,907	5,005	5,105	5,208	5,312	5,418	5,526	5,637	5,750	5,865	5,982	6,101	6,224	6,348	6,475	6,604	6,737	6,871	7,009	7,149	7,292	7,438	7,586
Net Operating Income	0	13,548	13,641	13,734	13,826	13,919	14,012	14,105	14,198	14,291	14,384	14,477	14,570	14,662	14,755	14,847	14,939	15,031	15,122	15,214	15,305	15,396	15,486	15,576	15,666	15,755	15,844	15,933	16,020	16,108	16,194
Loan Payment	0	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912	11,912
Payment Interest Part	0	8,250	8,101	7,946	7,784	7,616	7,441	7,259	7,069	6,872	6,667	6,453	6,231	5,999	5,758	5,507	5,247	4,975	4,692	4,398	4,092	3,774	3,442	3,097	2,738	2,364	1,975	1,570	1,149	710	254
Payment Principal Part	0	3,662	3,811	3,966	4,128	4,296	4,471	4,653	4,842	5,040	5,245	5,459	5,681	5,913	6,153	6,404	6,665	6,937	7,219	7,513	7,820	8,138	8,470	8,815	9,174	9,548	9,937	10,341	10,763	11,201	11,658
Cash Flow
Repairs/Construction	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
Cash Flow Before Taxes	-51,980	1,636	1,729	1,822	1,915	2,008	2,101	2,194	2,287	2,379	2,472	2,565	2,658	2,750	2,843	2,935	3,027	3,119	3,211	3,302	3,393	3,484	3,575	3,665	3,754	3,844	3,933	4,021	4,109	4,196	4,283
Depreciation	0	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561	7,561
Taxes	0	-1,132	-1,011	-887	-759	-629	-495	-357	-216	-71	78	231	389	551	718	889	1,066	1,247	1,435	1,627	1,826	2,031	2,242	2,459	2,684	2,915	3,154	3,401	3,655	3,918	4,190
Cash Flow After Taxes	-51,980	2,768	2,740	2,708	2,674	2,637	2,595	2,551	2,503	2,450	2,394	2,334	2,269	2,199	2,125	2,046	1,962	1,872	1,776	1,675	1,567	1,454	1,333	1,206	1,071	929	778	620	454	278	93

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 (1.00%)	$ 350,306
Cap Rate (5.21%) & NOI	$ 310,834
Gross Rent Multiplier	$ 346,936

Sale Proceeds

Projected Selling Price	$ 350,306
Costs of Sale (6.00%)	$ 21,018
Net Sale Proceeds Before Tax	$ 329,288

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	$ 329,288
Investor Cash Outlay	$ 51,980
Net Assets	$ 277,308
Average Yield
Annual Net Assets	$ 9,244
Average Cash Flow (After Taxes)	$ 1,799
Average Annual Gain (After Taxes)	$ 11,042
Average Annual Yield (After Taxes)	4.25 %

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: 5403 Bracken Dr, Indianapolis RENTAL

Property Report :

5403 Bracken Dr, Indianapolis, IN 46239

Executive Summary