Pyrrhus Group — Real Estate Underwriter

Property

Address For reference only

Type

Units

Purchase

ii.

Purchase Price

Closing Costs

Rehab / Renovation

After-Repair Value (ARV)

Financing

iii.

Down Payment

Interest Rate

Loan Term

Loan Points

Income

iv.

Gross Monthly Rent

Other Income / mo Laundry, parking, fees

Vacancy Rate

Operating Expenses

Property Tax Annual % of value

Insurance / mo

Property Mgmt % of rent

Repairs & Maintenance

CapEx Reserves Roof, HVAC, etc.

HOA / mo

Utilities / mo Owner-paid

Other Expenses / mo

Growth & Sale

vi.

Annual Rent Growth

Annual Expense Growth

Annual Appreciation

Selling Costs

Tax (optional)

vii.

Marginal Tax Bracket

Land Value Non-depreciable portion

The Verdict

—

Crunching the numbers…

Cash to Close

—

Monthly Cash Flow

—

Cap Rate

—

Cash-on-Cash

—

Deal Fundamentals

Year One Basis

Loan Amount—

Monthly P&I—

Loan-to-Value—

Total Project Cost—

Gross Annual Rent—

Effective Gross Income—

Annual Operating Expenses—

Net Operating Income—

Annual Debt Service—

Annual Cash Flow—

DSCR—

Op. Expense Ratio—

Pre-Debt Income / mo available for mortgage—

Underwriting Rules

Pass / Fail

1% RuleMonthly rent ≥ 1% of price

—

2% RuleAggressive cash-flow target

—

50% RuleOpEx ≤ 50% of gross rent

—

70% Rule (flips)Price ≤ 70% ARV − rehab

—

Gross Rent MultiplierUnder 8× is generally healthy

—

DSCR ≥ 1.25Typical lender minimum

—

CoC ≥ 8%Cash-on-cash return target

—

Sale Analysis

Exit Returns

Hold for 10 yrs

Sale Price—

Selling Costs—

Loan Payoff—

Net Sale Proceeds—

Cumulative Cash Flow—

Total Profit—

Return Multiple—

IRR—

30-Year Trajectory

Cash Flow • Value • Equity

Property Value Equity Cumulative Cash Flow

Annual Detail

Year-by-Year

Year	Gross Rent	Effective Income	OpEx	NOI	Debt Service	Cash Flow	Property Value	Loan Balance	Equity

The Pyrrhus Group