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    Should I Buy an Investment Property?
by BusinessCaseGuy.com 		   
    Understand the short and long-term financial impact if you invest in an income property. How fast will my equity grow? Will I have a positive monthly cash flow? What if the economy takes a turn for the worse?

Plug in the information, and then check out how your wealth stacks up by Year 10. 		   
    Instructions: Fill in the 'Yellow' fields, then review the 'Business Case Summary' tab    
                   
    Enter the Costs and Benefits associated with the purchase    
    1. What are your transaction and start-up costs?              
    Purchase Price            
    % down payment            
    Down Payment            
                   
    Legal and Regulatory Fees            
    Renovation and Repairs            
    Other Fees and Expenses   Add as required (e.g. Inspection)    
    Land Transfer Tax $   Check your government guidelines and calculators    
                   
    Annual property growth rate   US & Canada 20+ year growth ranges from 2-6%    
                   
    2. What are your mortgage details?              
    Mortgage Insurance   *If required, usually for low down payments.    
    Mortgage Amount            
    Interest Rate   Assumes this average rate over 10-years    
    Amortization Terms (years)            
    Monthly Mortgage Payment            
                   
    3. What is your estimated rental price and expenses?              
      Monthly $   Growth Rate (Yr.)        
    Rental Estimate          
    Property Taxes          
    Maintenance / HOA Fee          
    Home Insurance          
    Repair Allocation          
    Property Management Fees          
                   
    Occupancy Rate            
    Assumes full occupancy, adjust downwards as required.        
    Fee to find a tenant            
    If using an Agent, enter the estimated fee. It will be averaged out over 3 years.        
    Alternative Investment / discount rate            
    A low risk alternative investment (e.g. Bonds, Savings, GIC, S&P 500)        
    4. Are there any monthly utilities the Landlord (you) will pay?              
    Utilities and content insurance are usually paid by the tenant. If you are paying any of these costs, then include an estimate where applicable.    
      Monthly $   Growth Rate (Yr.)        
    Water          
    Electricity          
    Heat          
    Internet          
    Content / Tenant Insurance          
    Once your inputs are captured, review your analysis on the 'Business Case Summary' tab.
You can always return here to make updates. 		   
                   
                   
    Real Estate Investment Dashboard    
      Start-up Funds required            
                   
      Payback Period in Years            
                   
      Annualized ROI over 10 Years            
                   
      Year 1 Investment Metrics Cap Rate   Cash-on-Cash Return   Return on Investment    
         % at the end of Yr. 1        
                   
    Break Even on Cash Flow Break Even $ Amount   Estimated Amount   Difference    
         Max Offer Price to Break-even:        
         Min. Rent to Break-even:        
                   
    Full details are available in the 'Business Case Summary' and the 'Detailed Results' section below.

This calculator provides directional guidance. Decisions should be reviewed with your financial advisor, accountant, or real estate agent. 		   
                   
                   
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    Info@BusinessCaseGuy.com | www.BusinessCaseGuy.com    
 
 
    Should I Buy an Investment Property?
by BusinessCaseGuy.com 		       
                                     
    Business Case Summary        
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    4 Interested in the details? You can dive into the breakdown in the 'Business Case Details' section.        
                                     
      1. Equity Summary comparing Year 1 to Year 10              
        Equity Breakdown   @ Year 1 ($)   @ Year 10 ($)   % of Equity @ Year 10                
        Down Payment                    
        Start-up Expenses                    
        Operating Cash Flow                    
        Mortgage / Loan Interest                    
        Mortgage / Loan Principal                    
        Price Appreciation                    
        Total Equity                    
        Net Equity Growth:                      
        Annualized ROI (over 10 Years):                      
                                     
      2. Cash Flow Summary from Operating Activites          
        Real Estate Cash Flow Month 1   Year 1   Year 5 (Cumulative)   Year 10 (Cumulative)            
          Revenue                  
          Operating Expenses                  
          Mortgage / Loan Interest                    
          Mortgage / Loan Principal                  
        Net Cash Flow                  
                                     
      3. Key Considerations and Analysis          
         Start-up Funds required   The amount you can expect to pay to complete the sale. Includes upfront fees, taxes, expenses, and the down payment.            
                                     
         Payback Period in Years   The time to recoup the start-up funds invested. This is based on cash flow, mortgage principal repayment, and property appreciation.            
                                     
         Annualized ROI over 10 Years   A broad and deep term metric that takes into account your equity growth, cash flow, and property appreciation over time.            
                                     
         Year 1 Investment Metrics Cap Rate   Cash-on-Cash Return   Return on Investment                
           % at the end of Year 1                    
                                     
         Break Even Offer and Rent Break Even $ Amount   Estimated Prices   Difference   Suggestion            
           Max Offer Price to Break-even:                  
           Minimum Rent to Break-even:                  
    Info@BusinessCaseGuy.com | Theory Is Good, Numbers Are Better.        
                                     
                                     
                                     
                       
    Business Case Impacts Buying an Investment Property  
    Each key point has the details expanded further below.

This analysis provides directional guidance. You should review these decisions in detail with your financial advisor or accountant. 		 
     
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    1 Start-up funds required to close the deal            
      Investment Funds / Equity     Upfront $      
                 
                       
      Transaction Fees and Expenses     Upfront $      
                 
                 
                 
                 
        Transaction Fees and Expenses total          
                       
      Start-up Funds required          
             
    2 Estimated Monthly and Annual Cash Flow            
            Monthly   Year 1      
      Rental Income Estimate        
      Expenses              
        Operating Expenses            
                 
                 
                 
                 
                 
            Spread over 3 years  
        Financing Expenses            
          Mortgage Interest        
        Landlord Paid Utilities            
          Water        
          Electricity        
          Heat        
          Internet        
                 
        Total Expenses        
      Taxable Income        
        Less Mortgage Principal        
      Net Cash Flow        
             
    3 Break-even Analysis            
            Estimate   Break-even value   Delta  
      Max Offer Price to Break-even      
      Minimum Rent to Break-even      
                       
    4 Cumulative Equity Growth over 10 years            
      Equity Growth Areas Year 1   By Year 5   By Year 10  
        Start-up Expenses      
        Operating Cash Flow      
        Mortgage / Loan Interest      
        Mortgage / Loan Principal      
        Price Appreciation      
      Equity Growth      
                       
      Personal Equity            
      Down Payment          
      Equity including Growth      
             
    5 Annualized Return on Investment (ROI)            
      Benefit Areas        
             
        Operating Cash Flow      
        Mortgage / Loan Interest      
             
             
      Annualized ROI (rounded)      
                       
           
                       
    Info@BusinessCaseGuy.com | Theory is Good, Numbers Are Better.  
                       
                       
                           
                           
     Worst Case Scenario Calculator  
    This tool allows you to see the impact if everything doesn't go as planned. You should be able to manage your expenses through the worst case and not stretched thin.

The default assumptions are
1. Rental revenue is 5% lower and unit occupancy is <100%.
2. Expenses are 5% higher than expected.
3. Mortgage rate is 1% higher than planned.

You can adjust the figures in the Yellow Cells to cater to your scenario. 		 
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    2a  
    2b  
                           
    1 Estimate your Worst Case scenario by updating the 'Change' column              
                           
            Base Case   Change   Worst Case      
      Rental Income Estimate          
      Expenses                
        Operating Expenses                
                   
                   
                   
                   
                   
                   
        Financing Expenses                
          Mortgage Interest          
        Landlord Paid Utilities              
                   
                   
                   
                   
                   
        Total Expenses            
      Taxable Income            
        Less Mortgage Principal            
      Net Cash Flow          
                           
                           
    2 Break-even Analysis for the Worst Case Scenario              
            Break-even value   Estimate   Delta      
    a) Rent Required (Monthly)          
    b) Offer Price Adjustment          
    c) Rent Required (Annually)          
                           
    www.BusinessCaseGuy.com
Theory Is Good, Numbers Are Better.