Financial Analysis
In an effort to give you some guide lines into the financial aspects of a short term rental home, the following are some examples of different properties.
| |
NEW CONSTRUCTION |
RESALES |
| |
4 Bed |
5 Bed |
6 Bed |
|
4 Bed |
5 Bed |
| Selling Price |
$389,900 |
$419,900 |
$459,900 |
|
$379,900 |
$265,000 |
| Down Payment - 25% |
$97,475 |
$104,975 |
$114,975 |
|
$94,975 |
$66,250 |
| |
|
|
|
|
|
|
| Mortgage Amount |
$292,425 |
$314,925 |
$344,925 |
|
$284,925 |
$198,750 |
| Monthly Expenses |
|
|
|
|
|
|
| Mge - Interest Only @ 6.0% |
$1,450 |
$1,561 |
$1,710 |
|
$1,425 |
$994 |
| Taxes & Ins. |
$425 |
$450 |
$500 |
|
$425 |
$347 |
| Homeowners Assoc. |
$255 |
$255 |
$255 |
|
$255 |
$175 |
| Water |
$40 |
$45 |
$50 |
|
$40 |
$50 |
| Electric |
$250 |
$290 |
$325 |
|
$250 |
$242 |
| Telephone |
$65 |
$65 |
$65 |
|
$65 |
$65 |
| Management Fee |
$125 |
$125 |
$125 |
|
$125 |
$125 |
| Pool Clean |
$90 |
$90 |
$90 |
|
$90 |
$70 |
| Pest Control |
$25 |
$25 |
$25 |
|
$25 |
$25 |
| |
|
|
|
|
|
|
| Total Monthly Expenses |
$2,725 |
$2,906 |
$3,145 |
|
$2,700 |
$2,268 |
| Monthly Income |
|
|
|
|
|
|
| Occupancy: 60% 18 days |
$3,150 |
$3,420 |
$3,708 |
|
$3,150 |
$2,160 |
| 65% 20 days |
$3,500 |
$3,800 |
$4,120 |
|
$3,500 |
$2,400 |
| 70% 21 days |
$3,675 |
$3,990 |
$4,326 |
|
$3,675 |
$2,520 |
| Return on Cash (Annual) |
|
|
|
|
|
|
| Downpayment |
$97,475 |
$104,975 |
$114,975 |
|
$94,975 |
$66,250 |
| Closing Cost |
$7,500 |
$7,600 |
$7,800 |
|
$7,500 |
$6,300 |
| Furniture |
$22,800 |
$26,000 |
$28,000 |
|
$0 |
$0 |
| Total Cash |
$127,775 |
$138,575 |
$150,775 |
|
$102,475 |
$72,550 |
| Profit @ 65% (year) |
$9,300 |
$10,728 |
$11,700 |
|
$9,600 |
$1,584 |
| |
|
|
|
|
|
|
| Percentage return on cash invested |
7.30% |
7.70% |
7.80% |
|
9.40% |
2.20% |
| |
|
|
|
|
|
|
| Appreciation @ 15% p.a.* |
$67,785 |
$73,713 |
$80,685 |
|
$66,585 |
$41,334 |
| |
|
|
|
|
|
|
| Total Return |
$67,785 |
$73,713 |
$80,685 |
|
$66,585 |
$41,334 |
| % |
53.10% |
53.80% |
53.50% |
|
65.00% |
57.00% |
Income Notes: Assumes rack rate in low season, less 10% incentive to book discount, and 15% discount for commission (net to owner)
4 Bed $175 / night | 5 Bed $190 / night | 6 Bed $206 / night
*2004 Appreciation for Orlando - 15.8%
**2005 Appreciation for Orlando to date - 23.6%
Important Disclaimer: The above is a financial model based upon actual financial experience, but is intended solely as an indicative financial model and does not form any part of a contract or financial representation. You are strongly advised to make your own independent assesment and evaluation of real and or actual returns for any investment proposed by yourself. No warrenty express or implied is intended.
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