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analyzing charts and graphs

What Is Pro Forma in Real Estate?

Learn how to analyze and calculate pro forma in real estate.


[Updated: Feb 04, 2021 ] Feb 03, 2020 by Liz Brumer
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ACTUAL/CURRENT PERFORMANCE PRO FORMA
GROSS RENTAL INCOME $38,000 $68,000
VACANCY RATE -$5,700 (15%) -$8,200 (12%) 
GROSS INCOME $32,300 $59,800
PROPERTY INSURANCE $1,895 $2,800
PROPERTY TAXES $3,698 $5,670
REPAIRS & MAINTENANCE $2,100 $6,800 (saving 10% of gross income)
PROPERTY MANAGEMENT $10,500 $6,800 (their fee is 10% of gross income)
ADVERTISING EXPENSE $0 $2,200
PROFESSIONAL SERVICES (like legal fees) $200 $1,500
UTILITIES $5,300 $5,300
TOTAL EXPENSES $23,693 $31,070
NET OPERATING INCOME (NOI) $8,607 $28,730
LIST PRICE $410,000 $410,000
CAP RATE 2% 7%