LIVE IN ONE SIDE & RENT OTHER SIDE INVESTMENT RETURNS

Cash Flow Analysis

On This Duplex in New Braunfels, Texas

INVESTMENT RETURNS

NEW DUPLEX WITH 10 YEAR WARRANTY. 3/2/2 EACH SIDE. PRICE: $369,900

Location! Location! Location! And a quality duplex allows the investor to receive two financial returns from this long term real estate investment.
Net Monthly Cost to the owner and Equity Return.

 1. Net Monthly Cost to Owner

During the rental period from rental income

Rental Income
Your Renters are paying off your mortgage, paying your property taxes, insurance and expenses while giving you an up-front positive cash flow.

Tax Savings From Depreciation
You will deduct depreciation on ½ of your duplex on your tax return each year giving you a cash free reduction in your taxes. Depreciation is computed as approximately 3.25% on ½ of your purchase price over 27.5 years. (Your tax preparer may use other methods to give you a greater deduction.) You can also deduct 50% of interest, taxes, HOA dues, maintenance and fees. Depreciation is estimated at $4,862 per year. Consult your tax preparer.

Your tax savings Monthly Annual
15% tax bracket $63 $762
25% tax bracket $101 $1,212
28% tax bracket $110 $1,362
35% tax bracket $137 $1,698

Please Note: depending on location, HOA fees & taxes will change the results on the cash flow analysis

 2. Equity Return

IF YOU SELL OR DO A 1031 TAX FREE EXCHANGE OR A CASH OUT REFINANCE,

YOUR GROSS EQUITY WILL BE RETURNED IN THREE WAYS

1. Appreciation, Increase in value over time
In the San Antonio, New Braunfels Metro Area since 1990 we have had an increase in value of approximately 4.4% per year in the MEDIAN PRICE of single family homes and duplexes.  Starting at $63,300 in January, 1990 to $205,225 in May, 2016 – a period of 26.5 years. This shows a STABLE long term increase in value and SUBSTANTIAL increase in equity over 5, 10, 15 years.  Source: Texas A&M Real Estate Center

2. Principal Reduction
Each month your tenants make rent payments to cover the mortgage payment that reduces the amount of the principal loan. Over time the principal reduction becomes a significant amount of equity in your property.

3.  Return of Your Original Down Payment

Equity Return Chart – How Your Equity Accumulates

1          + 2          + 3          = 4
End of Year 4.40% Estimated Annual Appreciation Accumulated Appreciation Accumulated Principal Reduction Down Payment Total Equity
0  $    329,900 0 0  $      11,547  $      11,547
1  $    344,416  $      14,516  $         5,461  $      11,547  $      31,523
2  $    359,570  $      29,670  $      11,159  $      11,547  $      52,375
3  $    375,391  $      45,491  $      17,103  $      11,547  $      74,141
4  $    391,908  $      62,008  $      23,305  $      11,547  $      96,860
5  $    409,152  $      79,252  $      29,776  $      11,547  $    120,575
6  $    427,155  $      97,255  $      36,528  $      11,547  $    145,329
7  $    445,950  $    116,050  $      43,572  $      11,547  $    171,168
8  $    465,571  $    135,671  $      50,921  $      11,547  $    198,139
9  $    486,057  $    156,157  $      58,589  $      11,547  $    226,292
10  $    507,443  $    177,543  $      66,589  $      11,547  $    255,678
11  $    529,771  $    199,871  $      74,935  $      11,547  $    286,352
12  $    553,080  $    223,180  $      83,644  $      11,547  $    318,371
13  $    577,416  $    247,516  $      92,730  $      11,547  $    351,792
14  $    602,822  $    272,922  $    102,209  $      11,547  $    386,678
15  $    629,346  $    299,446  $    112,100  $      11,547  $    423,093