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Cashflow Analysis Worksheet

Date
Property Address
  Bedrooms
Baths
Sq. Ft.
Gross Income Mo. Yr.
Average per Unit Income $ $
Number of Units      
Estimated Gross Income $ $
Other Income $ $
Potential Gross Income (EGI+OI) $ $
Vacancy Allowance % $ $
Effective Gross Income (PGI-VA) $ $
Total Expenses $ $
Net Operating Income (EFI-TE) $ $
Debt Service Mo. Yr.
1st Mortgage $ $
2nd Mortgage $ $
3rd Mortgage $ $
Total Debt
Service(TDS)
$ $
LOAN RATE YEARS
$ %
$ %
$ %
  Mo. Yr.
Before Tax Cash Flow (NOI-TDS) $ $
 
    Target
Equity Dividend Rate
(BTCF/II)(Cash-on-Cash)
% (3%-15%)
Loan to Value
(Loan Amount/Purchase Price)
 
Debt Coverage Ratio
(NOI/Debt Service)
(>1.20)
Operating Expense Ratio
(Oper.Expenses/EGI)
% (25%-80%)
Cash Break-Even Ratio
((Exp.'s +TDS-Rsrvs)/PGI)
% (60%-80%)
Purchase Price    Cap Rate (NOI/PP)
$           %
$ Present Value
$ Initial Investment
Expenses Mo. Yr.     Mo. Yr.
Taxes $ $   Maintenance(per unit) $ $ $
Insurance $ $   Management(Off Site)   % $ $
Water/Sewer $ $   Management(On Site)   % $ $
Garbage $ $   Accounting/Legal $ $
Electricity $ $   Miscellaneous $ $
Licenses $ $   Gas $ $
Advertising $ $   Telephone $ $
Supplies $ $   Fire Tax $ $
Pest Control $ $   Elevator $ $
Lawn $ $   Budget for Replacements $ $

Disclaimer: This worksheet is offered as an aid to anyone who wishes to use it for the purpose of locating investment property. There is no guarantee of accuracy and we are not responsible for any decisions made based on the calculations or information supplied by this document.

Definitions:

Equity Dividend Rate (cash-on-cash return): Expresses the first-year relationship between the BTCF(Before Tax Cash Flow) and invested capital. Effectively, it shows the return to an investor on his or her cash investment in a property. Normally, equity dividend rates range between 3% and 15%. The higher the rate, the greater the return to the investor.

Debt Coverage Ratio (DCR): The purpose of this ratio is to determine how much the NOI produced by a property could decrease and still permit the mortgage payment to be made. Lenders generally specify a minimum DCR (such as 1.20) that they require the property meet during the first year of a loan term. The higher the ratio, the less risk to the lender.

Operating Expense Ratio: This ratio is designed to reveal the percentage of EGI (effective gross income) required to pay operating expenses. The lower the operating expense ratio, the less risk faced by the investor. Operating expenses range from 25% to 80% of EGI, depending on the type of property and the quality of the management of the property. The lower the operating expense ratio, the happier both investor and lender.

Cash Break-even Ratio: This ratio is used by both investors and lenders to measure total cash charges against PGI (Potential Gross Income). This ratio normally varies between 60% and 80%. The lower the ratio, the greater the cash return to the investor.