4157 mountain rose ave, north las vegas, 89031 2

8/4/2019 4157 Mountain Rose Ave, North Las Vegas, 89031 2

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IdealHomeBrokers

PropertyOfferingReport 1of4

[email protected]

(949)351-6913

4157MOUNTAINROSEAVE,NORTHLASVEGAS,89031

4bedroom2Fbath1814SFhomebuiltin2003

122,900$ Askingprice

Notes:

1 1,200$ Rent(seepage2forcomparables)

2 416$ Expenses(seepage2fordetail)

3 784$ Monthlynetoperatingincome

9,413$ Yearlynetincome

122,900$ Askingprice(Investment)

4 7.7% CapitalizationRate=netincome/askingprice

5 215,127$ Resalevalueinyear10(netof8%liquidationcosts)

92,227$ Profitfromsaleinyear10

6 12.1% InternalRateofReturn

Notes: 30-yearfixed 15-yearfixed$122,900 Askingprice $122,900

7 $98,320 Maximumloan $98,320

8 $24,580 Downpayment $24,580

9 5.25% Investmentloaninterestrate 4.75%

1 1,200$ Rent 1,200$

2 416$ Expenses 416$

3 784$ Monthlynetincome 784$

10 543$ Payment 765$

11 242$ Monthlycashflow 20$12 113$ Principalamortizationinpayment 376$

13 354$ Cashflowplusamortization 395$

4,251$ Yearlycashflowplusamortization 4,743$

8 24,580$ Downpayment(Investment) 24,580$

14 17.3% Cash-On-CashReturn=cashflow/downpayment 19.3%

5 134,907$ CashatSaleinyear10(profitplusamortization) 174,516$

6 29.2% InternalRateofReturn 32.8%

Financedpurchase

All-cashpurchase



IdealHomeBrokers


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(949)351-6913

4157MOUNTAINROSEAVE,NORTHLASVEGAS,89031

Notes: Calculations Terms

1 1,200$ Rent

CashOperatingExpenses

15 105$ PropertyTax 1.0%

16 70$ HomeownersInsurance 0.65%

17 30$ HomeownersAssociationFees varies

18 96$ PropertyManagementFees(%ofGrossRent) 8.0%

-$ OtherExpenses

19 301$ MonthlyCashExpenses 25.0%

ReserveExpenses

20 65$ MaintenanceandReplacementReserves 5.4%21 50$ VacancyandCollectionLoss 4.2%

115$ MonthlyReserveExpenses 9.6%

416$ TotalExpenses 34.6%

3 784$ NetOperatingIncome 65.4%

ComparableResales ResaleDate Amount

5916SUNRISECREEKST--3bed2bath1814SF --2002List:$119900 7/29/11 124,000$

5804WILLISST--4bed2bath1814SF--2003List:$127920 7/29/11 123,000$

5914CREEKSIDESANDSLN--4bed2bath1814SF--2003List:$104900 7/15/11 112,500$5816CREEKSIDESANDSLN--3bed2bath1712SF--2003List:$129900 7/13/11 120,000$

5836CREEKSIDESANDSLN--4bed2bath1814SF--2003List:$122720 5/6/11 123,000$

5921ROLLINGCREEKST--4bed4bath1746SF--2003List:$124900 3/11/11 123,000$

5852CREEKSIDESANDSLN--4bed2bath1814SF--2003List:$119900 2/16/11 115,000$

ComparableRentals LeaseDate Amount

5726RIPPLECREEKST--3bed2bath1814SF--2004List:$1200 6/24/11 1,200$

5819HARVESTCREEKST--3bed2bath1814SF--2002List:$1295 10/7/10 1,295$

5718MONTEZUMACREEKSTREET--4bed2bath1650SF--2003List:$1200 9/3/10 1,200$

3729DISCOVERYCREEKAV--4bed2bath1814SF--2003List:$1195 7/25/11 1,195$

5914CREEKSIDESANDSLN--4bed2bath1814SF--2003List:$1195 7/23/11 1,195$5827HARVESTCREEKST--3bed2bath1814SF--2002List:$1195 7/27/11 1,195$

GeneralDisclaimerThisreportrepresentstheconsideredopinionofIdealHomeBrokers.Wemakenoguarantee,warrantyorrepresentation

aboutit.Anyprojections,opinions,assumptionsorestimatesmaynotrepresentthecurrentorfutureperformanceofthe

property.Youandyouradvisorsshouldconductacareful,independentinvestigationofthepropertytodeterminetoyour

satisfactionthesuitabilityofthepropertyforyourneeds.

NetOperatingIncomeDetail



IdealHomeBrokers


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(949)351-6913

Projected10-yearappreciationtonearrentalparitywithliquidationresale

FinancingTermsandCash-On-CashReturns

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

C a s h - O n - C a s h R e t u r n

I nt er est Rat e

lowerinterestrates

generatehigherreturns

lowerinterestrates


lowerinterestrates


lowerinterestrates

generatehigherreturns lowerdownpayments


$183,951

$235,472

$122,900

$233,834

$-

$50,000

$100,000

$150,000

$200,000

$250,000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

RentalParity ResaleValue

2.5%annualrentgrowth

3yeartroughtobreakeven

5yearsof

double-digit

appreciaon

Undervaluaon

Resalenear

rentalparity

inyear10



IdealHomeBrokers


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(949)351-6913

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Themonthlypaymentisthebasedonthelargestloanalenderoffersthatstillprovidesforpositivecashflow

Estimatedhomeownersinsurance.

Thecapitalization(cap)rateisthe(yearly)NetOperatingIncomedividedbythepurchaseprice.Itisthesimplestmeasureof

aninvestment'sfinancialperformance,anditprovidesaconvenientcomparisontocompetinginvestmentalternatives.Acap

rateislikeaninterestrateonacheckingaccount,amutualfundreturn,orabondyield.Thecaprateisinverselyrelatedto

price;inotherwords,highcapratesaresynonymouswithlowpricesandvisaversa.Thecaprateaninvestorwillaccept

variesfrompersontoperson.Thereisnosingleappropriateratetoapplytovalue.Instead,weshowarangeofvaluesat

differentcapratestoshowthecurrentinvestmentreturnsomeonecanexpectfromthisproperty.

GrossRentisestimatedfromcomparablerentalsortakenfromactualrentrolls.

NetOperatingIncomeistherentalincomeminusthecashexpenses.Thisfigureisindependentoftaxesorfinancingwhich

varyconsiderablyfromdealtodeal.Manyrentalpropertiesarepurchasedwithoutdebt,andtheNetOperatingIncomeis

necessarytocomputetheCapitalizationRate.

Mortgageinterestratesvarybasedonamortizationschedule.Thequickertheloanamortizes,thelowertheinterestrate.

Themonthlycashflowshowstheamountleftoverafterallpaymentsandreserveshavebeenmet.

Theresalevalueatinyear10assumespricesappreciatestronglyafterthesupplyproblemsareresolved.(seepage3).

VacancyandCollectionLossisanallowancefortenantturnover.

TheInternalRateofReturnevaluatesthetimingandtheamountofeachsourceofincomeandcalculatesaratewhichwould

balancethesevarioussourcesofincomewiththeinitialinvestment.IRRisthebestmethodforcalculatingthereturnson

investmentswithvariableincome.

Estimatedmaintenanceandreplacementreserves.Thesearehigherinsingle-familydetachedhomesandinolderproperties.

Homeownersassociationduesfrompropertyinvestigation.

Propertymanagementfeesvary,but8%-10%ofthemonthlyrentisacommonfee.

Summaryofexpensesfrompage2

TheCash-On-CashReturnissimilartoacapitalizationrateinthatitshowsareturnoninvestment,butitismeasuredby

comparingtheTotalProfitandLossafterExpenses,DebtandTaxesandcomparesthattothecashinvestment.Thisisthe

importantrateofreturnforinvestorswhoarenotpurchasingwithallcash.Aslongasdebtislessexpensivethanthecaprate,thecash-on-cashreturnscanbemagnifiedbyincreasingdebt.Thisisanappropriateuseofleveragetoincrease

investmentreturns.

Thisisthepropertytaxamountsetbythelocaljurisdiction.

Maximumloanbasedonlenderlimitationsoravailablecashflow.Generallysmallerfor15-yearamortization.

Thedownpaymentreflectstheminimumup-frontinvestmentrequiredbasedonfinancinglimitations.

Thisisthecalculatedprincipalamortizationinthefirstpayment.Thisamountincreasesinsubsequentpayments.

Theactualmonthlygainincludesbothleft-overcashflowandamortizationintheloan.

Monthlycashexpensesaretheactualoutlaysofcasheachmonthtosupporttheproperty.

4157 mountain rose ave, north las vegas, 89031 2

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