Cashflow analysis

[lxcoupe89]

When doing a cashflow analysis are heat electricity and mortgage payment included in the vacancy percentage?

I have included 5% vacancy into the calculation which equals about $630. That will bearly make one payment per year. I actually included about an extra $740/year for these things into my analysis on top of the $630 for vacancy. Is that to conservative?

I feel for the 1st year it could be realistic. But if you averaged it out over a longer period the 5% would probably be more accurate.

[Debbie]

When doing a cashflow analysis are heat electricity and mortgage payment included in the vacancy percentage? Don't for the property taxes and insurance. Hopefully, there's no PMI that the original owner may have forgotten to cancel.....

I have included 5% vacancy into the calculation which equals about $630. That will bearly make one payment per year. I actually included about an extra $740/year for these things into my analysis on top of the $630 for vacancy. Is that to conservative?

I feel for the 1st year it could be realistic. But if you averaged it out over a longer period the 5% would probably be more accurate.

I'm sure others will chime in soon.
Debbie

[Jim Johnson]

When doing a cash-flow analysis are heat electricity and mortgage payment included in the vacancy percentage?

I have included 5% vacancy into the calculation which equals about $630. That will barley make one payment per year. I actually included about an extra $740/year for these things into my analysis on top of the $630 for vacancy. Is that to conservative?

I feel for the 1st year it could be realistic. But if you averaged it out over a longer period the 5% would probably be more accurate.

I figure 10% vacant for every property every year. The key is really 'how long does it take to turn'? As for figuring out your utilities and loan payment: The loan payment is already in the spreadsheet in the form of debt service. So it will adjust automatically. Utilities depends on how they are billed. If you require they pay everything, you need to put some numbers for electric, gas and water in your calculations. If you pay and then bill them, it is already in the numbers. Where people go wrong in these calculations is using numbers that are not realistic. So use real numbers you know you can hit, if you do better- more cash-flow, if not- you best change something.

[lxcoupe89]

Jim you answered my question dead on. Since this is my first property I am nervous about vacancy. I feel better using the 10% so I'll use that. The Water, Sewer, and Trash must be in my name but I plan to bill the tenants.

Can you provide any info on Subject to for me. I started another thread on this?

I understand the basics of how it works but I am not sure if I should prefer it. I am very close to signing an agreement on my first rental property.

[Jim Johnson]

Jim you answered my question dead on. Since this is my first property I am nervous about vacancy. I feel better using the 10% so I'll use that. The Water, Sewer, and Trash must be in my name but I plan to bill the tenants.

Can you provide any info on Subject to for me. I started another thread on this?

There is a ton of information on 'subject to' all over this board. Use the search function on the upper right of the toolbar and see what you can learn. If you have questions, add them to a existing thread or post a new question. It would take forever and a day to re-post all you will find on this board.

I understand the basics of how it works but I am not sure if I should prefer it. I am very close to signing an agreement on my first rental property.

Searching the board will turn up 'Magic Bullets' you never knew existed on the site....