STEP 1: Calculate Annual Mortgage Payments
Annual Mortgage Payments =
Mortgage Payment * 12
Annual Mortgage Payments = $2,000 * 12
Annual Mortgage Payments = $12,000
STEP 2:Calculate Gross Annual Income
Gross Annual Income =
Monthly Rent * 12
Gross Annual Income =
$1,500 * 12
Gross Annual Income =
$18,000
STEP 3:Calculate Vacancy and Credit Loss
Vacancy and Credit Loss =
(Gross Annual Income * Vacancy Rate)/100
Vacancy and Credit Loss =
($18,000 * 3%)/100
Vacancy and Credit Loss =
$540
STEP 4:Calculate Gross Operating Income
Gross Operating Income =
Gross Annual Income - Vacancy_Credit Loss
Gross Operating Income =
$18,000 - $540
Gross Operating Income =
$17,460
STEP 5:Calculate Net Operating Income
Net Operating Income =
Gross Operating Income - Total Annual Expenses
Net Operating Income =
$17,460 - $4,000
Net Operating Income =
$13,460
STEP 6:Calculate Net Net Annual Cash Flow
Net Annual Cash Flow =
Net Operating Income - Annual Mortgage Payments
Net Annual Cash Flow =
$13,460 - $12,000
Net Annual Cash Flow =
$1,460
Real
Bench is an excellent
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as other eight real estate indicators. Purchase this efficient
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