Gross actual yearly rent , and gross market rent is just there for convenience, it's the rents, times 12 months, if the property is occupied 93% of the time for each row.
Next up are the expenses.
This is the other half of ROI. Income minus expense divided by expense.. we're factoring in as much detail as we can to help you make the right decision.
A large part of what we do is property management for investors large and small, and we charge a flat rate 8% of rents. If your property management company is high cost, give us a call and we might be able to help.
we'll go ahead and add in an 8% property management cost for our projection, based on both actual, and market rents.
a good back of the napkin estimate is to assume one months rent in repairs each year, so we'll include that.
as an investor, you know that insurance rates can be tricky, and vary widely, but we'll use $650 yearly for single dwellings, and $1100 yearly for multi unit cost estimation.
HOA home owner association fees are a rarity, but we'll list them here if we see any.
The annual property tax comes straight from the county auditor's website.
Utilities are often a point of negotiation between landlord and tenants. Do not forget that this can be an expense if you decide to pay utilities,and change your calculations accordingly. We list this at $0 as a placeholder.
Other lists any other expenses we're aware of, as an example, some townships here require trash fees, the larger city does not. We'll list these if they apply to the property.
Finally, Profit and loss, the good stuff.
Here you'll see the total for net income (income minus expenses) at listed price for the property, and also, suggested price.
and then you'll see the Cap calculation results themselves.
Remember each is the cap rate/ROI expressed as a percentage of return, for each different scenario we've considered above. These cases are list price vs. suggested price, and actual rent vs. market rent.
This can be a little confusing, so we'll go over each in order.
row 33 is net (actual rent) income divided by net investment at list price.
row 34 is net (actual rent) income divided by net investment at suggested price
so the first two are all about the actual rent today, both list and suggested.
the next two discuss market rent.
row 35 is market level net income divided by net investment at suggested price
and row 36 is market level net income divided by net investment at list price.
If you'd like to discuss anything on this page, we're happy to talk, and can get you the data you need to make these complex decisions, and help at any step of the process of investing in single family units, as well as small and huge apartment blocks. We're driven to get you the real estate income you need, and take care of the hassle for you.
Remax incline has years of experience and skill in real estate sales and management to offer, and we'd love to assist you. 513 921 9560 x 200, or inclinehome.com.
Thanks for watching.