Rental Property Investment - $240,000 Property (New Orleans)
1. Upfront Costs
| Item | Amount | Notes |
|---|
| Purchase Price | $240,000 | |
| Down Payment (20%) | $48,000 | Standard loan |
| Closing Costs (3%) | $7,200 | Title, fees, etc. |
| Initial Repairs / Setup | $5,000 | Light updates |
| Total Upfront Cash Needed | $60,200 | |
|---|
2. Ongoing Annual Costs
| Item | Estimated Annual Cost | Notes |
|---|
| Property Taxes | $2,500 | Local rates |
| Insurance | $2,200 | Flood/wind risk |
| Mortgage (P&I on $192K @ 7%) | $15,330 | Approx. $1,277/month |
| Property Management (10%) | $2,160 | Based on rent |
| Repairs & Maintenance (5%) | $1,200 | Rule of thumb |
| CapEx Reserve | $1,000 | Major repairs |
| Vacancy Reserve (5%) | $1,080 | One month rent |
| Total Annual Costs | $25,470 | |
|---|
3. Rental Income
| Item | Amount |
|---|
| Monthly Rent | $1,800 |
| Annual Rent | $21,600 |
4. Net Operating Income & Cash Flow
| Item | Amount |
|---|
| Gross Rent | $21,600 |
| Operating Expenses (excl. mortgage) | -$10,140 |
| Net Operating Income (NOI) | $11,460 |
| Mortgage Payments | -$15,330 |
| Annual Cash Flow | -$3,870 (negative) |
5. ROI Analysis
| Metric | Value |
|---|
| Total Cash Invested | $60,200 |
| Annual Cash Flow | -$3,870 |
| Cash-on-Cash ROI | ~ -6.4% |
Note: This scenario runs at a small negative cash flow. However, it may still yield a strong long-term return via appreciation and principal paydown.