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A real estate investor would like to buy a Haunted Mansion residential rental property in Pomona, and needs to figure out how much it's worth considering debt financing and a 3-year planned holding horizon. The loan would be a fixed-rate amortizing loan for 25 years requiring monthly payments, with an annual rate of 6%. The planned debt service would equal $65,000 each year. The investor's required return is 12% before taxes on equity invested into the Haunted Mansion. In the table below there is additional information on the investor's estimated annual net operating income (NOI) for each year and the estimate resale price If you can do the math in Excel with correct referencing to cells with intermediate results. This will allow you to avoid rounding errors. Otherwise, increase decimal places - the more the better! Say, 6 or even higher Next, calculate other financing information relevant to the investor: The implied loan amount is $ The implied debt coverage ratio is [ Select ] [Select 1: 622,143 2: 648,993 3: 715,044 4: 840,704 5: 1.263,017 1: 1.11 2: 1.14 3: 1.34 4: 1.38 5: 1.50 First, fill out the missing values in the table below. Year 1 Year 2 Year 3 Year 3. NOI $90,000 $95,000 $100,000 $913,043 Resale price $ [ Select) Debt $65.000 service $65.000 $65.000 -Loan balance 1: 537,992 2: 567.235 3: 631,282 4: 792.983 5: 1,169,219 $ $ $ $ Select Select) [Select) -Before- Before- Select tax 1: 7,000 cash 2: 10,000 3: 25,000 equity 4: 28.000 5: 40,000 flow on 1: 16,000 2: 22,000 3:30,000 4: 32,000 5: 49,000 1:22.000 2:35,000 3:36,000 4:37.000 5:58,000 1: 109,042 2: 120,060 3:284,939 4:429,588 5: 462,008 tax equity cash flow from sale A real estate investor would like to buy a Haunted Mansion residential rental property in Pomona, and needs to figure out how much it's worth considering debt financing and a 3-year planned holding horizon. The loan would be a fixed-rate amortizing loan for 25 years requiring monthly payments, with an annual rate of 6%. The planned debt service would equal $65,000 each year. The investor's required return is 12% before taxes on equity invested into the Haunted Mansion. In the table below there is additional information on the investor's estimated annual net operating income (NOI) for each year and the estimate resale price If you can do the math in Excel with correct referencing to cells with intermediate results. This will allow you to avoid rounding errors. Otherwise, increase decimal places - the more the better! Say, 6 or even higher Next, calculate other financing information relevant to the investor: The implied loan amount is $ The implied debt coverage ratio is [ Select ] [Select 1: 622,143 2: 648,993 3: 715,044 4: 840,704 5: 1.263,017 1: 1.11 2: 1.14 3: 1.34 4: 1.38 5: 1.50 First, fill out the missing values in the table below. Year 1 Year 2 Year 3 Year 3. NOI $90,000 $95,000 $100,000 $913,043 Resale price $ [ Select) Debt $65.000 service $65.000 $65.000 -Loan balance 1: 537,992 2: 567.235 3: 631,282 4: 792.983 5: 1,169,219 $ $ $ $ Select Select) [Select) -Before- Before- Select tax 1: 7,000 cash 2: 10,000 3: 25,000 equity 4: 28.000 5: 40,000 flow on 1: 16,000 2: 22,000 3:30,000 4: 32,000 5: 49,000 1:22.000 2:35,000 3:36,000 4:37.000 5:58,000 1: 109,042 2: 120,060 3:284,939 4:429,588 5: 462,008 tax equity cash flow from sale
