For April, we are crunching the financials on a 10 Unit Income Property that sold during March in Vanier

This property was a conventional 10 Unit Building with an assumable mortgage!

Vanier 10 Unit Building, Sold March 2018
Listed Price $1,749,000

Selling Price $1,700,000
Scheduled Rental Income (SRI) $126,990
Effective Rental Income (ERI) $121,910
Total Operating Expenses (TOE) $40,216
Net Operating Income (NOI) $81,694
Capitalization Rate (CAP) 4.8%
Operating Expense Ratio (OER) 33%
Sales Price X Net Income 21
35% Downpayment $595,000
Mortgage (@ 3.25%) $1,105,000
Annual Debt Service (mortgage payments) $80,938
Cash Flow $756
Return on Investment (ROI) 0.12%

What is very interesting is that the buyer for this Investment Property assumed a mortgage from the seller at 3.57% and the banks would have applied a mortgage rate of about 5.5%, so this meant that his cash flow every year went from just $756, up to $10,380 and his mortgage payments went from $80,938 down to $71,314.

This Buyer seems to have got a pretty good deal and has a CAP Rate of 4.8% on this Investment and a nice positive cash flow with a 35% down-payment.

Check out some Income Properties for sale, get in touch with Patrick Walchuk if you want to buy or sell any type of Income & Investment Property.