Airbnb, Financial Model, Investment, Real Estate, Residential Properties

Budget, Budgeting, Cap Rate (Capitalization Rate), Cash Flow Analysis, Cash Flow Projections, Cash-on-Cash Multiple, DCF Model, Excel, Financial Analysis, Financial Feasibility, Financial Model, Financial Modeling, Financial Planning, Financial Projections, Financing, Forecast, Forecasting, Investment Multiple, Investor Cash Flows, Levered Yield, Private Equity, Property Valuation, Real Estate Valuation, Rental Income, Terminal Value

This is a detailed, well-structured and transparent cash flow model for the acquisition and short-term rent of residential real estate properties (apartments, houses). The model features clear navigation, color codes, and error checks.

With this model, you can analyze any number of properties from one to ten. All property units are analyzed independently and individually, and together as a fund. If needed, the number of properties can be extended rather easily.

The model includes numerous inputs and assumptions, which makes it very flexible in analyzing sensitivities. You can change them to see the effect on profitability, cash flows, and every unit’s financial performance.

The model produces the cash flow statements at the asset and investor levels. it also calculates key profitability metrics (IRR, cash-on-cash (CoC) multiple, gross return, DSCR, peak equity required amount and date) by property and on a total basis.

This is a comprehensive model which you can use for your own investment analysis and to present to prospective investors (banks or private equity institutions). You can also use it as a budgeting tool.

The calculations are accompanied by professionally designed magazine-quality charts to illustrate the findings of the analysis.

The model includes the following investment stages:

1. Funding. The model assumes the investments will be financed by equity and debt. Loan parameters (amount borrowed, interest rate, amortization period) can be set individually for every property unit.
2. Acquisition. For every property unit, you can set the date of acquisition, acquisition price, broker’s fees, and commissions.
3. Renovation and furnishing. You can choose the cost of renovation (if required), and the amount of time it will take. The model also takes into account the cost of furnishing.
4. Operation. This section has a lot of flexibility. For every property unit, you can set the nightly rates and the number of nights occupancy by month through the year to reflect the effect of seasonality. You can also specify Homeowners Association (HOA) fees, utility and cleaning costs, and annual property taxes. The model allows your assumptions on rent indexation and cost inflation.
5. Sale. It is assumed the properties will be sold after a certain period. This is needed for valuation and for making a complete picture of the business. Again, the holding period and exit cap rates are set individually on a property-by-property basis.