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Example: Multi-family Home Deal

So the question is, how do you go about purchasing a multi-famliy home as an investment property? We're here to help, take a look at the example below. Here's an example of a multi-family home purchased as an investment property.

Location: New Mexico
Price: $600,000
Type: Multifamily
No. Units: 8
Building Size: 6,800 SF
Lot Size: 0.56 Acres
Price/Unit: $75,000.00
Cap Rate: 6.96%
Date Last Verified: 3/25/2008
Property Identification: 15447063

Description: 8 Units in the NE all two bedroom units. Gated parking and fireplaces. Low maintenance landscaping. Great location. Write offers subject to inspection of property.

Location Description:
On Chelwood Park just north of Mountain.
No. Stories: 2 Commission Split: 3%

Net Operating Income: $41,760

Unit Mix Information
2 Bedroom/1 Bath
No. Units: 6
SF: 850
Avg. Mo. Rent: $600

2 Bedrrom/1 Bath
No. Units: 2
SF: 850
Avg. Mo. Rent: $550

Rough Numbers:
Down payment:
Loan amount:
Property tax rate:
Expenses: % of gross earnings

Loan amount:
Interest rate:
Loan term:
Annual tax:
Annual insurance:

Monthly Principal + Interest:
Monthly tax:
Monthly insurance:
Total monthly payment:

Interest payment per year:
Mortgage payments for the year:
Principal payments for the year:
Per year appreciation growth:

Gross income:
Operating expenses (managing property, landscaping, insurance, property taxes, painting - there are fixed and variable expenses):
Loan payments:
Cash flow =


Notes: The Single Family Home offers you the broadest potential renter basis--the greatest demand out of all the other types of property you might purchase, so renting this type of property is much easier compared to say a condo. But this all depends upon the quality of the property and it's location.

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