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Shane Willis, MBA, CDPE, CIAS, E-Pro

13621 Perdido Key Dr. Perdido Key Fl 32507 (Indigo 1104 West)

Gulf Front Condo. Ultimate Perdido Luxury

BeachIndigoPoolDeck

4 Bedrooms 4 baths, Yr Blt 2006 Sq Ft. 2312 $885,000

Spacious,open design,elegantly furnished condo in upscale Perdido Key. Each bedroom has unbelievable gulf or bay views. Amenities include meandering pool & waterfall, 2nd heated pool, gated entrance, tennis, spa/hot tub, gazebo, theater,fitness area. This is luxury at its best. Unit comes fully furnished.

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Deal of the week Dec 5 2011

Here is the deal of the week for all my investor out there. Over 10% Cash on Cash return View property here

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CIAS Calculations Worksheet
Property Price $75,000 Gross Annual Rent $9,600
Taxes $646 Utilities & Trash $0
Insurance $895 Lawn Service $0
HOA $0 Maintenance $500
Management $960 Vacancy Reserve $800
Total Expenses= $3,801
Gross Annual Rent $9,600
- Total Expenses $3,801
NOI= $5,799
NOI $5,799
Property Price $75,000
0.0773 Cap Rate = 7.73%
Debt Service Assumptions
NOI $5,799 # of Years 30
Debt Service $3,382 Rate 5.00%
Cash Flow= $2,417 % Down 30%
Closing Costs $0 (using 3%)
Payment $3,382 (annually)
Cash Flow $2,417
Amount Down $22,500
0.1074 Cash-On-Cash Return= 10.74%

5 Holiday Hosting Disasters and how to avoid them

    Take a look at the most common things that can go wrong when you have guests and learn how to prevent them.

      That’s just one of many hosting nightmares that can end your holiday party before it even begins. Thankfully, some of the most damaging mishaps easily can be avoided. We collected five of the most prevalent issues and give you preventative tips to keep your holiday party on track.

      Problem: The oven doesn’t heat

      For any holiday occasion, the oven is the most important appliance in your house. If it fails to work, the centerpiece of your meal could go from roasted beef, ham, duck, or Tofurky to Peking Duck from the local Chinese takeout joint.

      How to avoid:

      • There are any number of reasons a stove can break, but one common cause of disaster is easy to prevent. Don’t self-clean your oven until AFTER the holidays. You risk blowing a fuse or a thermostat, and tracking down an oven technician around the holidays can be tough.

      Problem: The kitchen sink clogs

      The day after Thanksgiving is the busiest of the year for plumbers. The prime cause of this clog-a-thon is the mistreatment of drains when cooking holiday feasts. We hope your Thanksgiving went well, and that you avoid clog-a-thons for the rest of the holidays.

      How to avoid:

      • Fats and cooking oils can solidify in your pipes, so never dispose of them in your kitchen sink.
      • If you have a garbage disposal, make sure it’s running before anything goes in it, and never feed it any stringy, fibrous, or starchy foods like poultry skins or potato peels.
      • To fix, don’t rely on chemical drain-clearing products that can harm your pipes. Use a snake instead, available for $15 at your local hardware store. Best to keep one on hand.

      Problem: The heat goes out

      As the party’s host, you’re supposed to hang guests’ coats—not apologize to them for having to keep them on. A lack of heat can stop a holiday party dead in its tracks.

      How to avoid:

      • The key to avoiding freezing your party to a standstill is regular maintenance of your HVAC. Every 90 days, a new one-inch pleated furnace filter should be installed. If you haven’t done it in a while, now’s a good time to replace it.
      • Also inspect insulation on refrigerant lines that are leading into your house. Replace them if they're missing or damaged.

      Problem: The toilet stops up

      Toilets have a way of clogging up at the worst times, such as during parties and when you have overnight guests. This is especially true if you have a low-flow toilet from the early 1990s.

      How to avoid:

      • Don’t flush anything other than sewage and toilet paper down the toilet. And there’s nothing wrong with putting up a polite note to remind your guests to do the same.

      Problem: The fridge doesn’t cool

      Without a properly functioning refrigerator, your meat could get contaminated, your dairy-based treats could go sour, and you may not be able to save your yummy leftovers. To avoid discovering a warm fridge after it’s too late, take these simple precautions.

      How to avoid:

      • Get a thermometer for your refrigerator to make sure each shelf stays below 40 degrees and you can be aware of any temperature changes.
      • Also make sure the condenser coils located on the back of the unit or beneath it are free to breathe. Coils blocked from circulating air by cereal boxes atop the fridge, or dirtied by dust or pet hair can prevent a fridge from keeping cool.

      See you at the beach

      Shane Willis MBA

      Broker Remax Orange Beach

      Certified Investor Agent Specialist

      CDPE, E-Pro, 203k

      Search Local Deals Here

      Copyright 2011 NATIONAL ASSOCIATION OF REALTORS®

      Cash on Cash return in Real Estate Explained

      Money HomeLast week I wrote a post on Capitalization rate in Real Estate investing. I received some responses on and off AR about how cash on cash return differs and which is better. This prompted my second post describing Cash on Cash Return. Here is a refresher for you from my last post

      First formula we need to evaluate is the Net Operating Income (NOI). The NOI is calculated by taking your annual rent on the property and subtracting the expenses like utilities, insurance, and homeowners association etc..(notice that I did not say you mortgage or taxes because these are NOT included in this calculation). Next to figure our Capitalization rate all we do is take our NOI and divide it into the purchase price of the property .

      Okay now we know NOI which is the first step in the Cash on cash return as well. In order to get our cash on cash return we must take the NOI and add the mortgage payments (including taxes) on the property. This gives us our Pre-Tax income on the property. All we have to do then is divide our pre-tax income by our initial cash investment (this is the actual $$$ you put into the deal) and we get our cash on cash return…….I know I know you want an example OK

      Lets go back to our example from my last post. We have a 3 bed 2 bath home forhour $120,000. Rent runs around $1,300 a month and expenses are around $1,600 a year so we will say we can make $14,000 a year (these calculations are all done annually). Remember these expenses do NOT count a mortgage

      I am going to add a few other things in there as well like Maintenance at $500 a year and a vacancy factor of $1300 a year (just in case it is not rented for a bit) also insurance at $1,000 a year. SO all that added up (including the $1600 from previous paragraph) gives us a total expense of $4,400 a year. That means our NOI is $11,200 a year. If we divide that into our purchase price of $120,000 we have a Capitalization rate of 9.33%. So if you were to pay cash for the property you would earn 9.33% on your money……………But wait what if we leverage and borrow money to buy the property?

      Lets say you only put 30% down and get a loan for 5% interest. That means that your annual payments would be around $5,411 a year. If you subtract that from our NOI of $11,200 a year you have a cash-flow of $5,789 every year. Now we use our new formula and take the pre-tax income of $5,789 and divide it into the cash down we used $36,000 (30% of the purchase price of $120,000) and we have a cash on cash return of……………….Drumroll please J………………………16.08%. So in this case you are earning over 16% on your money. I am not quite sure where you will find that rate of return anywhere else.

      See you at the beach

      Shane Willis MBA

      Broker Remax Orange Beach

      Certified Investor Agent Specialist

      CDPE, E-Pro, 203k

      Search Local Deals Here