61470 Granada Dr, Joshua Tree CA 92252

61470 Granada Dr, Joshua Tree, CA 92252

Singlefamily: 3 bedrooms , 2 bathrooms

Year built: 1964, Size: 1098 SF

Investment strategy: Rental Property

Purchase Price$ 369,900

Rent$ 1,700/mo

Monthly Cash Flow$ -273

Cash on Cash Return-3.95 %

Financial Analysis

Cash on Cash Return	-3.95 %
Internal Rate of Return (IRR)	10.67 %
Capitalization Rate	3.16 %
Gross Rent Multiplier (GRM)	18.13
Debt-coverage Ratio (DCR)	0.78
Operating Expense Ratio (OER)	39.68 %

Financial Breakdown

Purchase Price	$ 369,900
Purchase Costs	$ 6,000
Repair/Construction Costs	$ 3,000
Total Capital Needed Total Capital Needed Includes all projects costs (except selling costs). Total Capital Needed Includes all projects costs (except selling costs).	$ 378,900
Financing	$ 295,920
Total Cash Needed Cash out of Pocket Shows rehabber's cash outlay. Cash out of Pocket Shows rehabber's cash outlay.	$ 82,980
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.	$ 73,980
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.	$ 9,000

Operating Analysis

Rent	$ 1,700/mo
Gross Operating Income (GOI)	$ 19,380
Total Expenses	$ 7,690
Net Operating Income (NOI)	$ 11,690
Annual Debt Service	$ 14,971
Cash Flow Before Taxes (CFBT)	$ -3,281
Income Tax Liability	$ -1,966
Cash Flow After Taxes (CFAT)	$ -1,315

OUTSTANDING VIEWS - Joshua Tree Village! Now available and minutes from the Joshua Tree National Park entrance this 3 bedroom 2 bathroom home is ready to go! Stepping foot on the grounds of this beautiful home you'll be taken in by this gorgeous one of a kind desert charmer sure to please even the most discerning buyer. An abundance of natural light flows throughout the open floor plan and into the large . Wood laminate flooring takes you throughout this stunning remodeled home! The kitchen is completely redone with NEW countertops, beautiful cabinets, stainless steel oven/microwave/dishwasher, and galley sink! Each bathroom is gorgeous with custom mirrors, light fixtures, countertops, and beautiful hip/modern flooring! Each bedroom is good sized and both bedrooms facing west have gorgeous expansive views that go on for miles! The raised/elevated covered patio overlooking the large backyard as well as miles, and miles of desert views full of Joshua trees, cacti, desert flora, and BREATHTAKING mountain views! Additional features include recessed lighting, carpeted bedrooms, modern ceiling fans, HVAC, custom modern light fixture, beautiful fresh landscaping, attached 1 car garage, and mature trees! Come see this one ASAP because it won't last long!

Purchase Price	$ 369,900
Address	61470 Granada Dr , Joshua Tree, 92252, CA
MLS^® #	JT21172590
Listing Agent	Paul Karr
Listing Broker	Cherie Miller & Assoc.
Year Built	1964
Type	Singlefamily
Size	1098 SF
Bedrooms	3
Bathrooms	2

Property History

Date	Price	Change	Event
6/29/2000
10/21/1999
8/15/1991
4/15/1988

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.	$ 20,400
Total Gross Income	$ 20,400
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.	$ 1,020
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.	$ 19,380	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	$ 1,800	9.29 %
Utilities	$ 2,400	12.38 %
Repairs	$ 1,200	6.19 %
Property Capex	$ 100	0.52 %
Property tax	$ 1,086	5.60 %
Insurance	$ 1,104	5.70 %
Total Expenses	$ 7,690	39.68 %
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.	$ 11,690	60.32 %

Cash Flow (Year 1)

Net Operating Income	$ 11,690	60.32 %
Annual Debt Service	$ 14,971	77.25 %
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.	$ -3,281	-16.93 %
Income Tax Liability	$ -1,966	-10.14 %
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.	$ -1,315	-6.79 %

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).	39.68 %
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.	116.93 %

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.	$ 59,867
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.	10.67 %
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	1.72
Annual Depreciation	$ 10,761

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.	-3.95 %
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.	9.42 %
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.	3.16 %
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.	5.52 %
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.	18.13

Financing
Down Payment		$ 73,980
Loan		$ 295,920
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).		79.36 %
Debt Coverage Ratio		0.78

Loan Financing of: Purchase price ($ 369,900)
Type	Amortized
Loan Amount	$ 295,920
Down payment (20%)	$ 73,980
Amortization	30 years
Interest Rate	3.00 %
Monthly Payment	$ 1,247.61

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	20,400	20,808	21,224	21,649	22,082	22,523	22,974	23,433	23,902	24,380
Vacancy Loss	0	1,020	1,040	1,061	1,082	1,104	1,126	1,149	1,172	1,195	1,219
Gross Operating Income	0	19,380	19,768	20,163	20,566	20,978	21,397	21,825	22,262	22,707	23,161
Expenses	0	7,690	7,844	8,001	8,161	8,324	8,490	8,660	8,833	9,010	9,190
Net Operating Income	0	11,690	11,924	12,162	12,406	12,654	12,907	13,165	13,428	13,697	13,971
Loan Payment	0	14,971	14,971	14,971	14,971	14,971	14,971	14,971	14,971	14,971	14,971
Payment Interest Part	0	8,793	8,605	8,412	8,212	8,006	7,795	7,576	7,351	7,120	6,881
Payment Principal Part	0	6,178	6,366	6,560	6,759	6,965	7,177	7,395	7,620	7,852	8,091
Cash Flow
Repairs/Construction	3,000	0	0	0	0	0	0	0	0	0	0
Cash Flow Before Taxes	-82,980	-3,281	-3,048	-2,809	-2,566	-2,318	-2,065	-1,807	-1,543	-1,275	-1,001
Depreciation	0	10,761	10,761	10,761	10,761	10,761	10,761	10,761	10,761	10,761	10,761
Taxes	0	-1,966	-1,861	-1,753	-1,642	-1,528	-1,412	-1,293	-1,171	-1,046	-918
Cash Flow After Taxes	-82,980	-1,315	-1,187	-1,056	-924	-789	-652	-513	-372	-229	-83

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%)	$ 497,115
Cap Rate (3.16%) & NOI	$ 442,109
Gross Rent Multiplier	$ 442,007

Sale Proceeds

Projected Selling Price	$ 497,115
Costs of Sale (6.00%)	$ 29,827
1. Loan Balance Payoff	$ 224,958
Net Sale Proceeds Before Tax	$ 242,330

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	$ 242,330
Investor Cash Outlay	$ 82,980
Net Assets	$ 159,350
Average Yield
Annual Net Assets	$ 15,935
Average Cash Flow (After Taxes)	$ -704
Average Annual Gain (After Taxes)	$ 15,231
Average Annual Yield (After Taxes)	4.12 %

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: 61470 Granada Dr, Joshua Tree RENTAL

Property Report :

61470 Granada Dr, Joshua Tree, CA 92252

Executive Summary