How do we calculate ROI?

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We use the assumptions for long-term and short-term.

This is short-term rates assumption.

const Shorterm RATES Assumption = {
PROPERTY_MANAGEMENT: 0.1,
VACANCY: 0.1,
CAP_EX: 0.1,
MAINTENANCE: 0.05,
PMI: 0.02,
LOAN_INTEREST: 0.04,
DOWN_PAYMENT: 0.2,
PROPERTY_APPRECIATION: 0.02,
HOUSE_SELLING_FEE: 0.07,
CLOSING_COST: 0.04,
REHAB_COST: 0.05,
CLEANING: 0.15,
UTILITIES: 0.08,
};

This is Long-term rates assumption

const RATES = {
PROPERTY_MANAGEMENT: 0.08,
VACANCY: 0.042,
CAP_EX: 0.07,
MAINTENANCE: 0.05,
PMI: 0.015,
LOAN_INTEREST: 0.03,
DOWN_PAYMENT: 0.2,
PROPERTY_APPRECIATION: 0.03,
HOUSE_SELLING_FEE: 0.06,
CLOSING_COST: 0.035,
REHAB_COST: 0.03,
};

This for 3 bedrooms & 2 bath

Notes:

• We don't use negative ROI for our average calculation.

0.0417,
0.0573,
0.0545,
-0.0139,
0.0425

we will take out -0.0139 as part of the calculation