PROPERTY RETURNS INFO
ash-on-Cash Return on Investment is the big difference these properties offer over most ordinary income-generating real estate.

On any real estate investment we typically look at three major sources for ROI. The first is property appreciation. The houses we are offering you have a jump start in the fact that most of the appraisals are typically higher then the purchase price. This equals instant equity. Please note, we do not guarantee any appraised values, but they typically look very favorable. Lease to own.

The other part of the appreciation equation is future appreciation. We’ve all seen the dramatic gains of properties on the West Coast and we’ve all heard that they may not continue at that same dramatic rate. Dallas, however, is predicted to appreciate at a higher rate then most other cities in the nation over the next 15 years. Rent to own homes near me.

The second source of returns from investment real estate is the tax benefit, particularly depreciation allowance. Because land costs are low, about 80-90% of your purchase price is for the building itself, not the land. Since land is not depreciable, but all of the improvements (buildings and equipment) are, you get a depreciation allowance on about 80-90% of your investment. That compares very favorably to most other areas of the country in which only 50%, or sometimes as little as 30% of your investment is for improvements and the rest for land. The net is that the tax benefits from buying these houses is several times greater than the benefit would be from buying an equivalent-priced property elsewhere. These houses will typically produce a depreciation allowance of over $3,600/year. When that is added to the other business expenses for interest, taxes, repairs, management, etc. the result is a “taxable loss” on your 1040 even though the property may be producing positive cash flow and appreciating in value..Free listings rent to own homes.

 

The third major source of ROI is cashflow. These houses are built with the highest possible cashflow in mind. See the chart below for the estimated cashflow projection. Please note, this does not include appreciation. You may click on the link below the cashflow projections to see a detailed calculation that does also show appreciation.

NOTE: These houses may be bought either with or without the Guaranteed Lease to own homes Option. There are cashflow projections below for both options.

Section 8 Walker Rent Schedule

ESTIMATED CASHFLOW PROJECTION
Ravenview Phase II (with Guaranteed Return Option) 

Purchase Price: $124,500
20% Down: $24,900
Financed: $99,600
Monthly Interest: $581
Monthly Principal: $0
Monthly Taxes: $236
Monthly Insurance: $60
Monthly Management Fee $0
Monthly Leasing $0
Monthly Rent: $1,050 (Guaranteed Rent is net of any management or leasing fees)
Monthly Depreciation Allowance: $316

 

ESTIMATED CASHFLOW PROJECTION
Ravenview Phase II (without Guaranteed Return Option)

 

Purchase Price: $121,000
20% Down: $24,200
Financed: $96,800
Monthly Interest: $565
Monthly Principal: $0
Monthly Taxes: $236
Monthly Insurance: $60
Monthly Management Fee $100
Monthly Leasing $50
Monthly Rent: $1,200 (We think this is a conservative projection)
Monthly Depreciation Allowance: $306

Assumes 30-year fixed-rate loan with interest rate of 7% with 10-year interest-only period. Rent is estimated Section 8 rent for the specific house in the location where the Ravenview project is sited. Management fee is estimated at 8%. Leasing fee is estimated as 75% of first month’s rent with 2-year occupancy. Estimated depreciation allowance based on current IRS rules and lot value of $20,000. Taxes and Insurance are estimated based on recent rates experienced. NOTE: Section 8 rents vary based on the individual tenant’s voucher amount and which Housing Authority issued their voucher. The amount paid by the government may often be supplemented by additional rent paid by tenant plus rent for refrigerator, washer, and dryer from tenant.

Interactive Calculator for Payments, Amortization, and Appreciation.

We began building houses based on the described business model in the spring of 2006. As of this date, we have completed four projects which are closed and leased and we are on our fifth, Ravenview.

The new offering will be 21 houses built on Ravenview Road (and Fish Road). This is the same general area as the 4 previous developments. As stated above, the purchase price with a 20% down payment will be $121,000 or $124,500 (see above). Each house will be approximately 1,412 sq. ft. Click on the link for Current Project at the top of this page for detailed status and photos.

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