Personal Analysis Coniguration

Adjust the financing settings to reflect your personal financing scenario. These settings will be applied to the analysis of each property.

Term

Set term to the number of months your mortgage payment is amortized over.

Typically, this will be 15 years (180 months), 20 years (240 months), or 30 years (360 months).

Interest Rate

Set the interest rate to the applicable interest rate for your financing.

Down Payment

Set the down payment percentage your lender requires. Typically, this will be 20-25%.

Adjust the expense ratios to your preferred settings. These settings will be applied to the analysis of each property.

Vacancy Rate

Set the vacancy rate as a percent vacant per year. Below are some common vacancy rates expressed as days vacant per year.

3% = 10.8 days vacant per year

4% = 14.4 days vacant per year

5% = 18 days vacant per year

6% = 21.6 days vacant per year

7% = 25.2 days vacant per year

Capital Expenditures

Capital expendiatures represent the cost of replacing major systems such as roofs, water heaters, furnaces, central air, flooring, etc. This reflects the amount that should be saved each month to replace major systems as they fail in the future.

This amount is calculated as a percentage of annual gross rent. For instance, if capital expendiatures is set to 8% and gross rental income is $10,000/yr., the annual capital expendiature expense would be $800.

Maintenance Expense

The maintenance expense represent the cost of normal maintenance items such as painting, plumbing repairs, window & door repairs, etc.

Set the property management fees the appropriate settings. These settings will be applied to the analysis of each property.

Management Fee

Set the management fee to reflect your management percentage charged by your property manager or property management company.

Management fee is applied as a percentage of gross rent.

Leasing Fee

The leasing fee is the percentage of the first months rent charged for finding, screening and placing a new tenant.

Apply leasing fee every ___ months

The leasing fee is only applied when the property turns over. On average, rental properties turn over every 18 months, but that can very significantly depending on type, size, condition, location etc.

The leasing fee is applied using the following formula: 12 months / turnover rate * monthly rent = annual leasing expense

Example: 12 months / 18 month turnover rate * $995/mo. rent = $663.33/year leasing expense