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The word of the day is POTENTIAL!! [Code: 1110]

Posted by Powered by Simply Do It on January 19, 2023
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Why THIS deal??
  • ~$291/mo. cash flow at today's rate of 6.125%
  • ~$458/mo. cash flow once refinanced to 4.5%
  • Huge potential for rent increase with updates and finishing of basement for added square footage
  • Has been on the market for 35 days.  Great negotiation tool!
  • Great price point with aggressive suggested offer
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After 15 Years (no mortgage)
Original purchase price $220,000
Total investment (out of pocket) $75,900
15 yrs Project house value $432,226
Value (appreciation) Gain $212,226
15 yrs cash-flow generated $77,452
Total Gain $289,678
ROI (15 yrs) 382%
ROI (annually) 25%
   
Free & Clear cash flow (yr.) $19,679
Free & Clear cash flow (m) $1,640
  • 4 bedroom, 2 bath Single Family Residence
  • This house needs some TLC and updates
  • Awaiting seller's disclosures for information on any mechanical and roof updates
  • This opportunity is probably not best suited for a beginner investor
  • No HOA charges
  • Value-add opportunity for finishing the basement and adding a 5th bedroom.  Some basic construction has already been done (ie: venting and windows)
  • If a 5th bedroom is added and cosmetic updating is done, you can expect a jump in rental amount and increased monthly cash flow
  • Highly appreciating neighborhood
  • 9,100 square foot lot


Why should you consider this house / what makes it a good investment?

  • Built: 1977
  • Size: 1,783 square feet
  • Low Crime, Desirable Community, Good Schools

What's next?

Email/text for address, analysis and to get connected to Simply Do It's local team that handles this transaction.

Metro: St. Louis

Team: Nathan  – email directly at stl1@simplydoit.net

Code: 1110

Property Specifications 1
 Bedrooms 4
 Bathrooms 2
 Square Feet 1783
 Year Built 1977
 Garage Size 2
 Schools Rating (on scale of A-C) A/B
Purchase Assumptions My Offer
Offer used for analysis $220,000
Suggested offer (low) $220,000
Suggested offer (high) $235,000
Asking $239,900
Market Value (after improvements) $240,000
Improvements (lower) $8,000
Improvements (upper) $25,000
Closing Costs $2,200
Mortgage Costs $2,200
Other Fees At Closing  
Total Cost  $240,900
Financing Assumptions  
 Down Payment (%) 25%
 Down Payment Amount $55,000
 Financed Amount $165,000
 Interest Rate  (5/6 ARM) 6.125%
 Mortgage Term (Years) 30
 Monthly Mortgage Payment $1,003
 Cash Outlay (Total Out of Pocket) $75,900

Financial Assumptions Monthly Yearly
Rent (upper) $1,900 $2,000 $24,000
Rent (lower) $1,800 $21,600
Property Tax Rate (Approx.) 1.2%  
Property Taxes   $210 $2,520
Insurance   $100 $1,200
Repairs   $75 $900
Variable-Cost PM   7.5%  
Property Management Fee $143 $1,710
Leasing Fee 75% $59.4 $713
HOA   $0 $0
Vacancy Rate   4.0%  
Total Fixed Expenses $657 $7,886
 Total Expenses (Fixed + Mortgage) $1,660 $19,917

Financial Analysis / Deal Attractiveness      
Years: 5 10 15 20
 Cap Rate 4.6% 5.7% 6.8% 8.0%
 Net Cash Flow $17,459 $42,996 $77,452 $121,755
 Equity Increase $63,222 $141,719 $239,366 $361,076
 Total Gain $80,681 $184,716 $316,818 $482,830
           
 Average Cash Flow/Year $3,492 $4,300 $5,163 $6,088
 Average Cash Flow/Month $291 $358 $430 $507
 Average Gain/Year $16,136 $18,472 $21,121 $24,142
 Average ROI 106.3% 243.4% 417.4% 636.1%
 Annual ROI 21.3% 24.3% 27.8% 31.8%
 Projected Property Value $291,997 $355,259 $432,226 $525,870

Property Ratings Suggestions
 Item      Suggested Criteria (Min.) This Property FAVORABLE /
INSUFFICIENT
 Schools     B A/B FAVORABLE
 Square Feet     1000 1,783 FAVORABLE
 Bedrooms     3 4 FAVORABLE
 Bathrooms     2 2 FAVORABLE
 Year Built     1970 1977 FAVORABLE
 Rent/Price (%)     0.75% 0.91% FAVORABLE
 Average Cash Flow (at year 5)     $125 $291 FAVORABLE
 Average ROI (at year 5)     15% 21.3% FAVORABLE
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Disclaimer

Information contained herein was obtained from sources deemed reliable, however, Simply Do It and/or the owner(s) of the property make no guarantees, warranties or representation as to the completeness or accuracy thereof. The presentation of the property is offered subject to errors, omissions, changes in price and/or terms, prior sale or lease or removal from the market for any reason without notice.

The analysis is provided “As Is”. All the information is believed to be accurate (except for the small effects of some simplifying assumptions), but is not guaranteed, and depends on the values entered for the property. This analysis is intended for the purpose of illustrative projections. The information provided is not intended to replace or substitute for any legal, accounting, investment, real estate, tax, or other professional advice, consultation, or service. Simply Do It and/or the owner(s) are not responsible nor liable for any damages arising from the use of the analysis info. 

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