Base case
$685
3.4% net yield and 13.7% cash-on-cash return.
Stress assumptions
9.3%
Gross yield
3.4%
Net yield
$825
Monthly IO mortgage
$685
Monthly net cash flow
3.4%
Return on investment
13.7%
Cash-on-cash return
$8,214
Annual profit
Deal decision scenarios
Stress case
-$94
2% rate shock, 10% rent drop, 6 void weeks, 15% refurb overrun.
Break-even rent
$1,340
Rent required to cover mortgage, management, maintenance, and insurance.
Max price at 5% net
$164,280
Implied purchase price if current annual profit must equal a 5% net yield.
Risk flags
Stress case turns monthly cash flow negative.
Action plan
- 1. Base rent covers modelled monthly costs.
- 2. Negotiate purchase price toward $164,280 for a 5% net yield.
- 3. Stress case remains cash-flow positive before refurb overrun allocation.
Monthly income vs costs
Deal analyser
$7,200
UK SDLT estimate
$2,880
US transfer tax estimate
$261,650
Total acquisition cost
$81,650
True cash invested
$1,340
Break-even rent
10.1%
Yield on true cash
10-year projection
13.9%
Estimated IRR
$143,030
Year 10 total return
| Year | Value | Equity | Rent | Costs | Return |
|---|---|---|---|---|---|
| 1 | $247,200 | $67,200 | $22,200 | $13,986 | -$6,236 |
| 2 | $254,616 | $74,616 | $44,400 | $27,972 | $9,394 |
| 3 | $262,254 | $82,254 | $66,600 | $41,958 | $25,246 |
| 4 | $270,122 | $90,122 | $88,800 | $55,944 | $41,328 |
| 5 | $278,226 | $98,226 | $111,000 | $69,930 | $57,646 |
| 6 | $286,573 | $106,573 | $133,200 | $83,916 | $74,207 |
| 7 | $295,170 | $115,170 | $155,400 | $97,902 | $91,018 |
| 8 | $304,025 | $124,025 | $177,600 | $111,888 | $108,087 |
| 9 | $313,146 | $133,146 | $199,800 | $125,874 | $125,422 |
| 10 | $322,540 | $142,540 | $222,000 | $139,860 | $143,030 |
Portfolio mode
$64,200
Gross income
$41,400
Net income
$205,000
Total equity
17.4%
Blended yield
$238,000
Cash invested
Net yield by property
Stress test
Rent -10%Cash flow: $524Yield: 2.6%Green
Rent -20%Cash flow: $363Yield: 1.8%Green
Rate +1%Cash flow: $535Yield: 2.7%Green
Rate +2%Cash flow: $385Yield: 1.9%Green
Void 4wCash flow: $542Yield: 2.7%Green
Void 8wCash flow: $400Yield: 2.0%Green
Mortgage overlay
$240,000
Property value
$180,000
Loan amount
$1,105
Monthly mortgage repayment
$13,264
Annual mortgage cost
$745
Net monthly cash flow
$8,936
Net annual cash flow
14.9%
Cash-on-cash return