You just don’t take a break do you? I would still be taking a little break if I had to wait 8 hours at the airport for the next available flight!!!
I got most of that at the boot camp. I’m sure I didn’t explain myself well. In developing the projections for my business plan, I’m trying to figure out how to value the equity on the property as time passes. For the purposes of my business plan I want to only count the equity value that can come by way of a refinance.
So, to that end, if the banks only loan you money on the dirt, then I would assume that I would keep the lease/option properties completely off of my calculation (except for the lot rent).
The rentals is where I get a little confused. Again, I would only count the lot rent towards the income. I know the bank will not loan on the rental income, but you still have expenses that are tied in to the rentals. That would affect the NOI.
So, to simplify my question, do I only include the lot rent income into my calculations for bankable equity? My report would therefore ignore the rental income and lease/option incomes…correct?
I guess I got myself in trouble when I tried using a blanket expense percentage as a rule instead of specifically looking at expenses. But sometimes when doing preliminary reviews of properties the income statements are rather incomplete and lacking any detail. My goal was to create a simple spreadsheet to let me visualize a business plan going forward for 5 years or so and see if the risk/reward is worth it.
Thanks for the help.