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 Rental ExamplesNote: All calculations are in U.S. dollars. All examples assume that the lot is purchased with cash, and that the buyer has put US $0 down on construction of the home. Duplex examples assume that a 2-floor structure is allowed on the lot. DUPLEX Example 1: Duplex on 1 Floor 1) Duplex: 2,558 sq. ft. (1,279 sq. ft each floor) X 60 sq. ft. = 153,480 2) 153,840 financed over 20 years at 9 % interest rate = 1,368 monthly payment 3)Taxes: % on ( 223,380 150,000 = 73,380) = 366.90 per year or 30.58 per month 4) Insurance: 1% per year = 1,534.80 per year or 127.90 per month 5)Utilities and water: 2,400 per year or 200 per month 6)Rental income = 44,000 per year or average of 3,667 per month 7)Maintenance fees: 300 per year or 25 per month 8)Property management fee (20%): 8,800 per year or 733.40 per month 9)Expenses = 1,368 + 30.58 + 127.90 + 200 + 25 + 733.40 = 2,484.88 10) PROFIT 3,667 β 2,484.88 = 1,182.12 per month
1)Duplex: 3,374 (1,687 sq. ft each) sq.f t X 60 sq ft. = 202,440 2)202,440 financed over 20 years at 9 % interest rate = 1,800 monthly payment 3)Taxes: % on (272,340 β 150,000 = 122,340) = 611.70 per year or 50.98 per month 4)Insurance: 1% per year = 2,024.40 or 168.70 5)Utilities and water: 2,400 per year or 200 per month 6)Rental income = 44,000 per year or average of 3,667 per month 7)Maintenance fees: 300 per year or 25 per month 8)Property management fee (20%): 8,800 per year or 733.40 per month 9)Expenses = 1,800 + 50.98 + 168.70 + 200 + 25 + 733.40 = 2,978.08 10) PROFIT: 3,667 β 2,978.08 = 688.92 per month Example 3: Duplex on 1 Floor 1)Duplex: 3,754 (1,877 sq.ft each) X 60 sq.ft = 225,240 2)225,240 financed over 20 years at 9% interest rate = 2,002.82 monthly payment 3)Taxes: % on (295,140 β 150,000 = 145,140) = 725.70 per year or 60.48 per month 4)Insurances: 1% per year = 2,252.40 per year or 187.70 per month 5)Utilities and water: 2,400 per year or 200 per month 6)Rental income = 44,000 per year or average of 3,667 per month 7)Maintenance fees: 300 per year or 25 per month 8)Property management fee (20%): 8,800 per year or 734 per month 9)Expenses = 2,002.82 + 60.48 + 187.70 + 200 + 25 + 733.40 = 3,209.40 10) PROFIT 3,667 β 3,209.40 = 457.60 per month
Example 1 1)Home: 1,450 sq. ft X 60 sq ft. = 87,000 2)87,000 financed over 20 years at 9% interest rate = 773.60 monthly payment 3)Taxes: % : none, there are no taxes under 150,000 4)Insurances: 1% per year = 877 per year or 73.08 per month 5)Utilities and water: 2,400 per year or 200 per month 6)Rental income = 22,000 per year or average of per month 1,833.33 7)Maintenance fees: 300 per year or 25 per month 8)Property management fee (20%): 4,400 per year or 366.67 per month 9)Expenses = 773.60 + 73.08 + 200 + 25 + 366.67 = 1,438.35 10) PROFIT 1,833.33 β 1,438.35 = 394.98 per month Example 2 1)Home: 1,991 X 60 sq.ft = 119,460 2)119,460 financed over 20 years at 9% interest rate = 1,062.23 monthly payment 3)Taxes: % on (199,360 β 150,000 = 49,360) = 246.80 per year or 20.57 per month 4)Insurances: 1% per year = 1,194.60 per year or 99.55 per month 5)Utilities and water: 2,400 per year or 200 per month 6)Rental income: 22,000 per year or average of 1,833.33 per month 7)Maintenance fees: 300 per year or 25 per month 8)Property management fee (20%): 4,400 per year or 366.67 per month 9)Expenses = 1,062.23 + 20.57 + 99.55 + 200 + 25 + 366.67 = 1,774.02 10) PROFIT 1,833.33 β 1,774.02 = 59.31 per month Example 3 1)Home: 3,020 X 60 sq.ft. = 181,200 2)181,200 financed over 20 years at 9% interest rate = 1,611.22 3)Taxes: % on (261,100 β 150,000 = 111,100) = 555.50 per year or 46.29 per month 4)Insurances: 1% per year = 1,812 per year or 151 per month 5)Utilities and water: 2,400 per year or 200 per month 6)Rental income at: 22,000 per year or average of 1,833.33 per month 7)Maintenance fees: 300 per year or 25 per month 8)Property management fee (20%): 4,400 per year or 366.67 per month 9)Expenses = 1,611.22 + 46.29 + 151 + 200 + 300 + 366.67 = 2,675.18 10) PROFIT 1833.33 β 2,675.18 = 841.85 per month |
