607 Byland Dr, Beech Grove IN 46107

607 Byland Dr, Beech Grove, IN 46107

Singlefamily: 2 bedrooms , 1 bathroom

Year built: 1951, Size: 1600 SF

Investment strategy: Rental Property

Purchase Price$ 150,000

Rent$ 825/mo

Monthly Cash Flow$ -119

Cash on Cash Return-4.78 %

Financial Analysis

Cash on Cash Return	-4.78 %
Internal Rate of Return (IRR)	6.13 %
Capitalization Rate	3.63 %
Gross Rent Multiplier (GRM)	15.15
Debt-coverage Ratio (DCR)	0.79
Operating Expense Ratio (OER)	38.92 %

Financial Breakdown

Purchase Price	$ 150,000
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).	$ 150,000
Financing	$ 120,000
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 30,000
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.	$ 30,000
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.	$ 0

Operating Analysis

Rent	$ 825/mo
Gross Operating Income (GOI)	$ 8,910
Total Expenses	$ 3,468
Net Operating Income (NOI)	$ 5,442
Annual Debt Service	$ 6,875
Cash Flow Before Taxes (CFBT)	$ -1,433
Income Tax Liability	$ -1,842
Cash Flow After Taxes (CFAT)	$ 409

Say hello to this lovely 2 bedroom, 1 bath home with fresh paint inside and out. Stylishly updated kitchen and bathroom, new lighting and ceiling fans, beautiful hardwood floors, built-in shelves throughout, and a sunny enclosed climate controlled back porch make up the first floor. Head downstairs to the finished basement with NEW water resistant hardwood laminate, cool retro bar area and lots of unique storage. Laundry/mechanical room with even more storage and a sump pump are included in this completely dry basement. 1 car garage with service door to a fenced yard with mature trees and a covered patio/carport make this large corner lot a great place to hang out. See attachments for more features and information. Schedule now!

Purchase Price	$ 150,000
Address	607 Byland Dr , Beech Grove, 46107, IN
MLS^® #	21814549
Listing Agent	Lori Scott Meyer
Listing Broker	Highgarden Real Estate
Year Built	1951
Type	Singlefamily
Size	1600 SF
Bedrooms	2
Bathrooms	1

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.	$ 9,900
Total Gross Income	$ 9,900
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.	$ 990
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.	$ 8,910	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	10.64 %
Property tax	$ 2,364	26.53 %
Insurance	$ 156	1.75 %
Total Expenses	$ 3,468	38.92 %
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.	$ 5,442	61.08 %

Cash Flow (Year 1)

Net Operating Income	$ 5,442	61.08 %
Annual Debt Service	$ 6,875	77.16 %
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.	$ -1,433	-16.08 %
Income Tax Liability	$ -1,842	-20.67 %
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.	$ 409	4.59 %

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).	38.92 %
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.	116.08 %

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.	$ 11,111
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.	6.13 %
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	1.37
Annual Depreciation	$ 4,364

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.	-4.78 %
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.	0.22 %
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.	3.63 %
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.	6.60 %
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.	15.15

Financing
Down Payment		$ 30,000
30y		$ 120,000
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		0.79

30y Financing of: Purchase price ($ 150,000)
Type	Amortized
Loan Amount	$ 120,000
Down payment (20%)	$ 30,000
Amortization	30 years
Interest Rate	4.00 %
Monthly Payment	$ 572.90

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	9,900	9,999	10,099	10,200	10,302	10,405	10,509	10,614	10,720	10,827	10,936	11,045	11,156	11,267	11,380	11,494	11,609	11,725	11,842	11,960	12,080	12,201	12,323	12,446	12,570	12,696	12,823	12,951	13,081	13,212
Vacancy Loss	0	990	1,000	1,010	1,020	1,030	1,041	1,051	1,061	1,072	1,083	1,094	1,105	1,116	1,127	1,138	1,149	1,161	1,172	1,184	1,196	1,208	1,220	1,232	1,245	1,257	1,270	1,282	1,295	1,308	1,321
Gross Operating Income	0	8,910	8,999	9,089	9,180	9,272	9,365	9,458	9,553	9,648	9,745	9,842	9,941	10,040	10,140	10,242	10,344	10,448	10,552	10,658	10,764	10,872	10,981	11,090	11,201	11,313	11,426	11,541	11,656	11,773	11,890
Expenses	0	3,468	3,537	3,608	3,680	3,754	3,829	3,906	3,984	4,063	4,145	4,227	4,312	4,398	4,486	4,576	4,667	4,761	4,856	4,953	5,052	5,153	5,256	5,361	5,469	5,578	5,690	5,803	5,919	6,038	6,159
Net Operating Income	0	5,442	5,462	5,481	5,500	5,518	5,536	5,553	5,569	5,585	5,600	5,615	5,629	5,642	5,654	5,666	5,677	5,687	5,696	5,705	5,712	5,719	5,724	5,729	5,733	5,735	5,737	5,737	5,737	5,735	5,732
Loan Payment	0	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875	6,875
Payment Interest Part	0	4,762	4,675	4,586	4,493	4,396	4,295	4,189	4,080	3,966	3,848	3,724	3,596	3,462	3,323	3,179	3,028	2,871	2,708	2,538	2,362	2,178	1,987	1,787	1,580	1,364	1,140	906	663	410	147
Payment Principal Part	0	2,113	2,199	2,289	2,382	2,479	2,580	2,685	2,795	2,909	3,027	3,150	3,279	3,412	3,551	3,696	3,847	4,003	4,167	4,336	4,513	4,697	4,888	5,087	5,295	5,510	5,735	5,968	6,212	6,465	6,728
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	-30,000	-1,433	-1,413	-1,394	-1,375	-1,357	-1,339	-1,322	-1,306	-1,290	-1,275	-1,260	-1,246	-1,233	-1,221	-1,209	-1,198	-1,188	-1,179	-1,170	-1,163	-1,156	-1,151	-1,146	-1,142	-1,140	-1,138	-1,137	-1,138	-1,140	-1,143
Depreciation	0	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364	4,364
Taxes	0	-1,842	-1,789	-1,734	-1,678	-1,621	-1,561	-1,500	-1,437	-1,373	-1,306	-1,237	-1,166	-1,092	-1,017	-938	-858	-774	-688	-599	-507	-412	-313	-211	-106	3	116	234	355	480	611
Cash Flow After Taxes	-30,000	409	376	341	303	264	222	178	132	83	31	-23	-81	-141	-204	-271	-340	-414	-491	-571	-656	-745	-837	-935	-1,036	-1,143	-1,254	-1,371	-1,493	-1,620	-1,754

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%)	$ 202,177
Cap Rate (3.63%) & NOI	$ 157,901
Gross Rent Multiplier	$ 200,156

Sale Proceeds

Projected Selling Price	$ 202,177
Costs of Sale (6.00%)	$ 12,131
Net Sale Proceeds Before Tax	$ 190,046

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	$ 190,046
Investor Cash Outlay	$ 30,000
Net Assets	$ 160,046
Average Yield
Annual Net Assets	$ 5,335
Average Cash Flow (After Taxes)	$ -376
Average Annual Gain (After Taxes)	$ 4,959
Average Annual Yield (After Taxes)	3.31 %

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: 607 Byland Dr, Beech Grove RENTAL

Property Report :

607 Byland Dr, Beech Grove, IN 46107

Executive Summary