Real-Estate-Proforma.com - Quick Proforma

Real-Estate-Proforma.com

This is a simple real estate proforma that can be used to project the profitability of a real estate project. You can use this proforma for an investment property or for your own home. Enter the variables in the cells with blue titles on the right hand side. When you enter your property's information, you can update the proforma by clicking on the next cell, or click the update button. Each title has an information box you can view by moving the mouse over the title. By becoming a member, you will have access to a variety of Excel proformas that can be changed to fit your projects.
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* Enter your property's information in the white boxes adjacent to the blue cells.

PropertyPriceThe price you pay for the property. If you are financing the improvements on the properties, then add the total cost of improvements to the price you pay for the property.	Appreciation Appreciation is the increase in value of a property over time. Factors that influence the rate at which real estate appreciates include inflation, capital improvements, supply and demand. Real estate investors look for many factors that will cause real estate to appreciate in value before they purchase properties. And when weighing the benefits of purchasing a home or renting, many people choose to buy in order to increase their net worth via appreciation. If the property's value is going to decrease then enter a negative percentage.	TotalInvCstThe Total Investment Cost is equal to Property Price plus Purchase Costs plus Improvements.	DebtCoverageDebt-Coverage Ratio is equal to the Net Operating Income divided by the Mortgage Payments for the first year. Lenders use the Debt Coverage Ratio to determine if an income-producing property has sufficient income to cover the operating expenses and debt service. To acquire a loan for an income-producing property, the Debt Coverage Ratio must usually be greater than 1.1. A Debt Coverage Ratio of less than 1 indicates that the income generated by a property is insufficient to cover the mortgage payments and operating expenses.
ImprovementImprovement costs will be added to the first year's expenses, but not included in the Debt Coverage Ratio. You may be able to qualify for a loan that includes improvement costs if you finance the improvements. Improvements such as siding, a new roof, a new addition, new carpeting, landscaping, paint, etc., can increase the value of both personal residences and income property. Some improvements, dollar for dollar, will result in a greater increase in value than others. You should plan carefully and make improvements that result in the highest level of appreciation for the dollars that you spend. Keep in mind that if you make too many costly improvements, you might not recover those costs when you sell. Small improvements can sometimes deliver the greatest bang for your buck.	An.Expenses Annual Operating expenses are costs incurred during the operation and maintenance of a property. They include repairs and maintenance, insurance, management fees, utilities, supplies, property taxes, etc. The following are not operating expenses: principal and interest, capital expenditures, depreciation, income taxes, and amortization of loan points. *Do not include interest payments or property taxes. Your property taxes will be added to your annual expense automatically.	MonthlyPymtThe Monthly Payment on your Mortgage.	RentMultThe Gross Rent Multiplier or GRM is a ratio used to estimate the value of income-producing properties. Operating expenses, debt service and tax consequences are not included in the GRM calculation. The GRM is equal to the Total Investment Costs divided by the Income, multiplied by the Occupancy Rate for the first year.
AcquisitionCst Aquisition Costs are the costs involved with the purchase of the property such as loan fees, closing costs, loan points, legal fees, appraisals, etc. With some mortgage types you will be able to finance the aquisition costs as well as other costs involved with a property sale. For more information go to our Mortgage Page.	CPIThe Consumer Price Index (CPI) is used to project the annual percentage increase in operating expenses. For some properties, such as an older building, the annual increase in property expenses may be greater than the CPI for Expenses.	AnnualMortAnnual Mortgage Payment is equal to (PMT(interest, mortgage rate, loan period)). This is the formula used by Excel to determine annual payments. There are a variety of loans on our Loan Quotes page, where you can get more information about receiving competitive loans.	Loan/ValueThe Loan-to-Value Ratio or LTV Ratio is calculated by dividing the loan balance of a property by the market value and is expressed as a percentage. Or LTV = Balance of Loans/Market Value. For this Proforma, the LTV Ratio is the Loan Principle divided by the Property Price. Lenders may require mortgage insurance on loans with a loan-to-value ratio greater than a predetermined amount, usually 80%. This means that the purchaser of a property will need to put a minimum of 20% down to avoid paying mortgage insurance premiums.
MortgagerateThis Annual Mortgage Rate is for a fixed-rate loan. Lenders are currently offering a wide variety of specialized loans. There are a variety of loan types that you can pre-qualify for on our Mortgage Quotes page. If you become a member you will have access to real estate proformas you can manipulate to suit any loan type.	RentIncrseRent Increase is the annual percentage that rental income in you area is increasing. If you do not know how much rents are increasing in your area, you can use the Consumer Price Index (CPI) for Annual Rents. If you believe the rents in your area are decreasing then enter a negative number.	LoanPrincplThe Loan Principle or Mortgage Principal is the Property Price less Down Payment. As you make payments overtime, you will pay down the Loan Principal. Equity is built by paying down Loan Principal.	% DownPercent Down is equal to the Down Payment less Property Price/100
LoanPeriodThe number of years to pay back the mortgage. By becoming a member you will have access to Excel real estate proformas that you can adjust to meet any mortgage time-payment shcedule.	PropTaxRateProperty Tax Rate is determined by the location of the property. To find out what your property tax rate is, check with your local municipal or county Tax Assessor. If you know the amount of your future annual property tax payment, enter a property tax rate that results in the actual price you are paying below.	Tax BasisProperty Tax Basis is the amount the Tax Assessor will use to determine the property's Annual Property Tax. The Annual Property Tax is equal to the Tax Basis multiplied by the Property Tax Rate. The Tax Assessor will usually use the sale price of the property as your property's Tax Basis, unless you appeal to the tax assesor for a re-assesment of the property's value. If you do not know your property tax rate, contact your Local Municipal Tax Assessor. Tax Assessor Records offer a variety of valuable information on the ownership, title, and property tax history for individual properties. The fastest and most comprehensive way to search for all available information on a particular property is to use third-party software such as WinData.	CashFlow-NOI Cash Flow or Net Operating Income (NOI) is equal to a property's yearly gross income less operating expenses.*in the first year Gross income includes both rental income and other income such as parking fees, laundry and vending receipts, etc.
DownPaymentDown Payment is the cash amount you pay at closing. There are a variety of loan types, some of which you can borrow 100% or more of the property price. To see what types of loans you pre-qualify for, go to our Mortgage Quotes page. In many property deals real estate developers receive funding from multiple sources. By becoming a member, you will have access to Excel spreadsheets that allow for multiple sources of income. Members have full access to Excel spreadsheet proformas.	TotalSqFeetThe Property's Total Square Feet is the property's living space and not garages, patios, sheds, etc.	AnPropTaxAnnual Property Tax is equqal to the Property Tax Rate multiplied by the Property Price. In some states, property tax is not fixed, and can increase and decrease overtime. If you do not know the property tax rate in your property's area, check with you local Tax Assessor.	Cap RateCapitalization Rate is the NOI divided by Property Price. This calculation of NOI is for the first year only. You can read more about real estate capitalization rate by clicking on the Financial Terms link at the top of this page. By becoming a member, you will have access to Excel proformas that allow you adjust your NOI formulas for the number of years you plan on holding your investment property.
MonthlyIncmeThe property's monthly income from rents and all other sources of income. As a member, you will have access to Excel proformas in which you can add multiple sources of income into your own custom proforma.	OccupancyTentant Occupancy Percentage Rate is the percentage of the year there will be income received from tenants.	Price/Sq.FootThe Price per Square Foot of the property. This amount is determined by dividing the Total Investment Cost by the Total Square Feet.	CashonCashCash on Cash Return is a percentage that measures the return on cash invested in an income-producing property. It is calculated by dividing before-tax cash flow by the amount of cash invested. The improvements in this Proforma are added to to the first year's expenses but in most cases, improvement costs are financed. If your loan includes capital for improvements, add the improvement amount to the price of the property, and enter 0 for Improvemnts.

YearThis proforma only forecasts up to 10 years. By becoming a member you will receive Excel spreadsheets that forecast for your own home purchase as well as investment properties with investors and multiple loan sources. As a member you will be able to modify and personalize your own spreadsheets.
MortRemainingMortgage Remaining is equal to the years remaining on the mortgage.
Open MortgageOpening Mortgage is the mortgage balance at the beginning of the year.
InterestPymnt The Interest Payment is the amount of your annual mortgage payment that is paid towards the interest on your mortgage. The Interest Payment is equal to the Mortgage Rate multiplied by the Opening Mortgage. Each successive year, you will be paying less towards the interest on your loan and a greater portion of the annual mortgage payment will go towards paying down the principal on your loan. The Interest Payment plus the Equity in your property is equal to your Annual Mortgage Payment. The longer you own a property, the faster your equity grows.
PaymentThis is the annual amount you will pay for your property's mortgage. The formula for Mortgage Payment is PMT (interest, mortgage rate, loan period).
Close Mortgage The Closing Mortgage is the mortgage balance at the end of the year. This amount is calculated by adding the Sum Opening Mortgage plus the Annual Interest minus the Annual Mortgage Payment.
EquityAccumulated Equity is equal to the Opening Mortgage less the Closing Mortgage plus Improvements.
Income The Effective Gross Income is equal to, 1 plus the Rent Increase Rate multiplied by the Annual Income, multiplied by the Occupancy Rate. Effective Gross Income = Annual Income * (1+Rent Increase Rate) * Occupancy Rate.
ExpensesOperating Expenses are costs associated with the operation and maintenance of income-producing properties. They include such items as property taxes, property management fees, insurance, wages, utilities, repairs and maintenance, supplies, advertising, attorney fees, accounting fees, trash removal, pest control, etc. The following are not operating expenses: loan payments, personal property and capital improvements. Operating Expenses are equal to Payment + Annual Property Taxes + (Operating Expenses * CPI Expenses)) note: improvements are included in year 1
CashFlow/NOIBefore-Tax Cash Flow or Gross Operating Income is equal to the sum of Income + Expenses amounts above.
Sum Cash FlowThe Sum Cash Flow is equal to the accumulated cash flow during the time span of your property ownership.
IncreasedValueThe annual increase in property value is equal to the Property Price multiplied by the Appreciation Rate.
Profit at SaleProfit gained if property is sold at end of that year equals (Increased Value - Close Mortgage + Sum Cash Flow - Down Payment.) You may have to pay taxes on this amount depending on how you use your property. You should contact an attorney or tax specialist for advice.