Multi-family
1,976 sqft. Interior
3,510 sqft. Exterior
3 Bathrooms
3 Doors
Property Location
611 Martin Luther King Jr Way, Tacoma, WA 98405
Washington,
98405
Disclaimer:
As experts in property purchasing, we offer consultations and detailed analyses of rental income properties. However, the images, financial projections, and examples presented are for illustrative purposes only and do not guarantee returns or the expected profitability. The configurations and features of the properties may vary. We strongly recommend that you consider our guidance, but also conduct your own research and due diligence before making any investment decisions. Trust our expertise, but remember that all investments carry inherent risks. You are solely responsible for your investment decisions. Your trust is our priority.
Comprehensive Financial Details
At Great Front Door, transparency is key. We want you to have a clear understanding of all costs associated with your property investment. Below, we break down the pricing for Rental Income Property to help you make an informed decision
INVESTMENT DETAILS
- Description Amount
- Cash Due at Closing
- Down Payment: $ 65,000
- Agent Fees: $ 9,750
- Mortgage Fees: $ 2,600
- 1st Year's Insurance: $ 3,250
- 1st Year's Taxes: $ 3,250
- Total Closing Costs: $ 83,850
- Renovation Cost: $ 150,000
- Mortgage While Renovating: $ 5,406
- Property Management Fees: $ 5,063
- Total Initial Investment: $ 244,319
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INVESTORS CONSIDERATIONS
- Description Amount
- Listing Price: $ 325,000
- Days on Market: 317
- Fix and Flip Max Price: $ 471,365
- After Repair Value (ARV): $ 744,808
- Equity after Renovation (EaR): $ 175,489
- Redfin YoY Home Price Growth in 98405 6.90%
- Zillow YoY Home Price Growth in 98405 3.00%
- Max. Cash Available from EaR eligible for Cash Out Refinance: $ 140,391
- Remaining Total Initial Investment after Cash Out Refinance: $ 103,928
- Additional Cash Available after Total Initial Investment is Returned: $ 0
- Return of Investment via Cash Out Refinance: 4 years and 9 months
RENTAL COMPARISON AND CASH FLOW
- Description Amount
- Monthly Income
- Avg. Monthly Rent ( 2 x 2-bed, 1-bath, 695-sqft rental unit): $ 1,659
- Avg. Monthly Rent ( 1 x 1-bed, 1-bath, 731-sqft rental unit): $ 1,745
- TOTAL Avg. Monthly Rent: $ 5,063
- Monthly Expenses
- Monthly Mortgage Payment: $ 1,802
- Monthly HOA (if any): $ 0
- Monthly Insurance: $ 271
- Monthly Tax: $ 271
- Monthly Maintenance: $ 271
- Monthly Property Management Fees: $ 506
- Total Monthly Payment: $ 3,121
- Monthly Cash Flow: $ 1,943
- Annual Cash Flow: $ 23,311
- Return of Investment via Rental Cash Flow: 10 years and 9 months
- Debt-Service Coverage Ratio (DSCR): 2.16
HOW WOULD I RETURN MY INITIAL INVESTMENT?
- Initial Investment: To acquire this property with listing price of $325,000 and maximize the rental potential of this property, you will need an initial investment of approximately $244,319. This includes closing costs totaling $83,850 which is a down payment of $65,000, agent fees of $9,750 and mortgage fees of $2,600. Initial investment also includes your renovation budget of $150,000 and mortgage payments during the renovation over 3 months totaling $5,406.
- After Repair Value (ARV): The property has an After Repair Value (ARV) of $744,808. The maximum price for a Fix and Flip is estimated at $471,365. After completing all renovation costs, the Equity After Renovation stands at $175,489. Since there is positive equity after the renovation, you can perform a Cash Out Refinance with your mortgage assuming the ARV and get 80% of this equity back totaling $140,391 in cash after the renovation. This shortens the original Return of Investment duration because the entire Initial Investment can be cashed out of the property after the renovations and Cash Out Refinance are complete.
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ARV Comparison Data
Comparable Property Link After Repair Value (ARV) $ 501,923 $ 900,000 $ 832,500 Comparable Property Link: https://www.zillow.com/homedetails/1004-S-9th-St-Tacoma-WA-98405/2079832312_zpid/
After Repair Value (ARV): $ 501,923Comparable Property Link: https://www.zillow.com/homedetails/1112-S-8th-St-Tacoma-WA-98405/49201175_zpid/
After Repair Value (ARV): $ 900,000Comparable Property Link: https://www.zillow.com/homedetails/1419-S-Ainsworth-Ave-AB-Tacoma-WA-98405/49201846_zpid/
After Repair Value (ARV): $ 832,500 -
Rental Cash Flow:
This 2 bedroom, 1 bathroom, 695 square foot unit can be rented at an average of $1,659 per month. Comparable rents are $1,700, $1,495, $1,783 in this area. Monthly expenses total $3,121. That includes monthly mortgage $1,802, property management fees $506, HOA, and then monthly budgets for taxes $271, insurance $271 and maintenance $271. Monthly cash flow is $1,943 totaling to $23,311 in annual rental income. Returning a Total Initial Investment of $244,319 is estimated at 10 years and 9 months.
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2-bed with 1-bath Unit Monthly Rent Price Comparison Data
1-bed with 1-bath Unit Monthly Rent Price Comparison Data
Rental Unit Link Rent Estimate Square Feet $ 1,700 700 $ 1,495 650 $ 1,783 735 Rental Unit Details Rental Unit Link: https://www.zillow.com/apartments/tacoma-wa/midtown-15/5ZWr6R/#unit-2054960014
Rent Estimate: $ 1,700
Square Feet: 700Rental Unit Link: https://www.zillow.com/homedetails/1002-1004-Earnest-S-Brazill-St-12-Tacoma-WA-98405/450055874_zpid/
Rent Estimate: $ 1,495
Square Feet: 650Rental Unit Link: https://www.zillow.com/rental-manager/price-my-rental/results/1601-s-g-st_-tacoma_-wa-98405/
Rent Estimate: $ 1,783
Square Feet: 735Rental Unit Link Rent Estimate Square Feet $ 1,399 563 $ 2,025 772 $ 1,810 859 Rental Unit Details Rental Unit Link: https://www.zillow.com/apartments/tacoma-wa/unionaire/5XnWZj/#unit-2099339003
Rent Estimate: $ 1,399
Square Feet: 563Rental Unit Link: https://www.zillow.com/apartments/tacoma-wa/aspire11/BvQydt/#unit-440903389
Rent Estimate: $ 2,025
Square Feet: 772Rental Unit Link: https://www.zillow.com/apartments/tacoma-wa/chelsea-heights/5XjScD/#unit-2067425317
Rent Estimate: $ 1,810
Square Feet: 859 - Return of Investment: Since there is positive Equity after the Renovation, you can perform a Cash Out Refinance with your mortgage assuming the After Renovation Value of $744,808 and get 80% of the $175,489 in Equity back in cash after the renovation totaling $140,391. This shortens the original Return of Investment duration of 10 years and 9 months to 4 years and 9 months because the entire Initial Investment of $244,319 which included Closing Costs, Renovation Budget and getting tenants in, can be cashed out of the property after the renovations and Cash Out Refinance are complete. With Total Monthly Expenses amounting to $3,121, including mortgage payments, taxes, insurance, and maintenance, you can anticipate a Monthly Cash flow of approximately $1,943, resulting in an Annual Cash Flow around $23,311 going forward.
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