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1
Hurricanes Katrina and Rita,
which hit the U.S. in the summer
of 2005 were considered the most
devestating natural disasters our
counrty has ever seen. These
catastrophes had an enormous
impact on the affected states’
economies. As a result, Congress
approved House Bill number
HR 4440 on December 16, 2005
which was signed by President
Bush five days later.
HR 4440, otherwise known as
the Gulf Opportunity Zone Act
of 2005, or the GO Zone Act, of-
fers several federal tax benefits
for commercial properties built in
the regions affected by the hur-
ricanes. These tax incentives are
being offered by the federal gov-
ernment to help restore normal
life in the affected states. The GO
Zone Act applies to certain spe-
cific cities, counties, and states,
including Mississippi.
2
Two
Reasons
to Invest
in the Mississippi GO Zone
The federal and state governments have
implemented some very aggressive
incentives for those who want to invest in
Mississippi.
1. Uncle Sam needs you! The federal gov-
ernment has implemented some amazing tax 2. The people of Mississippi need you! The
incentives for those who help rebuild the State of Mississippi has implemented the
GO Zone area of Mississippi. An investor
Small Rental Assistance Program (SRAP).
can claim a federal 50% BONUS DEPRE-
In general, this is how it works: If you buy a
CIATION on a new property put into rental
pre-construction rental property and place it
service prior to the December 31, 2010 dead-
in the SRAP rental program for 5 years, the
line. For example, let’s say a buyer purchases
Mississippi state government will give you
a $269,000 pre-construction duplex, and then
rents it out. Let’s assume the value of the land up to $73,000 in cash per 3-bedroom duplex,
is 20% and the remaining 80% ($215,200) is if construction of your property is completed
the actual structure. The buyer could claim within 6 months from the time you
a bonus depreciation deduction of $107,600 applied to the program. (Sub-
(in addition to the normal $7,825), for a to- ject to other restrictions.)
tal depreciation deduction of $115,425 for
tax purposes. If the buyer is in the 35% tax
bracket, that could equate to a tax savings of
$40,398. WOW! If you bought 2, 3 or more
properties, you would receive similar bonus
depreciations on each property. As you can
see, it might be possible to offset all of your
taxable income!! Of course, the ability to use
all the bonus depreciation depends on each
buyer’s circumstances, and it may be possi-
ble to carry over unused depreciation into the
next tax year, or get a rebate for it from prior
tax years. (Please consult your tax advisor.)
3
Why Mississippi?
Although New Orleans received “... proven catalysts for billion. In fact, casino companies
have purchased 175 acres of real
the lion’s share of news coverage economic growth and real estate for expansion purposes since
in the aftermath of Hurricane
Katrina, other areas of the Gulf estate appreciation ...” Katrina, and experts are predicting
that the number of casino workers
Coast were hit just as hard. After The Biloxi-Ocean Springs Bridge will double to 30,000 within the
the hurricane, the governor of is being rebuilt now, and once next few years. Even with the
Mississippi described Biloxi again will provide easy highway wide-ranging construction (and re-
as an American version of the access to Biloxi when it re-opens construction), casinos have shown
atomic bombing of Hiroshima. this winter. Gulfport-Biloxi record revenues in nine of the last
Casino barges were literally lifted International Airport is already 11 months.
out of the water, and the Biloxi- seeing 20% more passengers
Ocean Springs Bridge was almost than the 2005 passenger tally. Unfortunately, even with the broad
entirely destroyed. However, The airport is also undergoing economic success of the casinos,
the city is staging a dramatic, a major, $51 million expansion, many casino workers are still
well-planned comeback. Because to be finished this year, which living in FEMA-provided trailers
Mississippi is starting from an will increase terminal square and other sub-standard housing.
almost blank slate - 90% of ocean footage by 80%, as well as allow There is simply not enough
front buildings were destroyed - access to two more airlines. housing to provide space to all of
there is plenty of opportunity. These are proven catalysts for the workers. The combination of
economic growth and real estate more and more casino workers and
Biloxi is being rebuilt from the appreciation. more and more tourists visiting
Biloxi results an increased demand
ground up, basically creating an
for housing, and the supply of
entirely new waterfront city. An Why are so many people coming
housing is not growing nearly as
estimated 55,000 new homes will to Biloxi, though?
quickly as the demand. Economics
need to be built in the next few 101 tells us that when demand
years, and fewer than 10,000 (less Biloxi is well-known for its
increases faster than supply, prices
than 18%) of these homes have numerous casinos, many of go up, and that is exactly what is
already been built. The creation which were temporarily shut happening to rental prices today.
of an almost entirely new ocean down following Katrina. Seven Approximately 60% of casino
front city is unprecedented in of the nine casinos have already workers rent, and rental properties
modern American history, as re-opened, and there are plans to are now being leased for 10 to 20%
most ocean front real estate was add 10 more in the near future. A over market value only a few days
developed years ago. This is a change in Mississippi state law after they go on the market.
rare chance to create a brand new allowing the casinos, formerly
community, with none of the restricted to barges, to be built on This appears to be a “perfect
problems and disadvantages of land has resulted in an influx of storm” of favorable factors for
real estate that was developed in billions of dollars from the casino Biloxi: casino-fueled economic
accordance with 19th- and 20th- industry. Just one example of the growth; low supply coupled
new casino resorts is the Harrah’s with high demand for housing;
centry standards, not 21st-century
Entertainment-Jimmy Buffet joint transportation system upgrades;
standards.
project, Margaritaville. This is an and “smart money” purchases of
oceanfront casino resort with a real estate and investments in
It’s not much of a secret that
first phase budget of $700 million, casino-bulding. Biloxi could also
more and more people will be
and may eventually cost $1.3 be the perfect investment.
visiting Biloxi in the near future.
4
Reasons To Invest
In Biloxi, Mississippi
BILOXI IS A SOLID GROWTH AREA IN TODAY’S BILOXI’S CASINOS ARE PROVIDING A
VOLATILE REAL ESTATE MARKET POWERFUL CATALYST FOR REAL ESTATE
PRICES
In 2006, Biloxi was one of the top three best-performing
markets in the United States, with an increase of 15.7% in After the devastation of Hurricane Katrina, the
the price of an average house over a one-year Mississippi government passed a law allowing the
period. A recent article on CNN Money lists Biloxi as one formerly barge-based casinos to be built on dry land.
of the metropolitan areas unaffected by the nationwide real This has fueled massive growth in the casino industry
estate downturn. of Biloxi. Two years after Katrina, eight casinos are
already open, and twelve more have been proposed
THERE IS A CRITICAL SHORTAGE AND URGENT or are under construction. The Gulfport-Biloxi region
DEMAND FOR HOUSING IN THE REGION is estimated to be the third-largest casino district in the
United States. Each casino employs an average
Hurricane Katrina destroyed more than 65,000 homes and of 2,200 people, of which, approximately 60% will
47,000 rental properties. Altogether, 101,000 Mississippi rent their homes. This surge in demand will be facing
residents are living in FEMA trailers - limited supply in the housing market,
this totals approximately 80,000 people on the Mississippi which should increase the value of real estate.
Gulf Coast alone. However, business has continued, and
employees need to live somewhere. As FEMA BOTH THE FEDERAL AND STATE
programs come to an end, over 30,000 families will soon GOVERNMENTS ARE PROVIDING GENEROUS
be evicted from government trailers and will require INVESTOR INCENTIVES
affordable housing.
Due to the incredible need for housing in the region,
MISSISSIPPI’S ECONOMY IN GENERAL, AND government assistance has been made readily
BILOXI’S IN PARTICULAR, IS RAPIDLY EXPANDING available. There is a federal bonus depreciation
allowance available, as well as up to $40,000 per
Mississippi has recovered and is economically stronger four-bedroom residence through the Mississippi Small
than before Katrina, as measured by gross state product Rental Assistance Program. In total, there
and employment figures. Aside from casinos, detailed is $260 million of government assistance to encourage
below, other industries are growing rapidly. Local real estate investment in the region.
employers, including the Northrop Grumman Ingalls
Shipyard, Dupont, Triton Systems, Chevron, and
GE Plastics are constantly searching for employees.
There is a significant military presence in the
region as well, including Keasler Air Force Base,
which provides $1.2 billion in economic impact
annually via 86,000 military and civilian
employees and families.
5
Biloxi
Casinos
“Biloxi’s casinos reported March 19, $86.2 million in gross
gaming revenue in February, the largest February in the
city’s gaming history, according to figures released by the
mayor’s office.”
- Gulf Coast News (May 19, 2007)
“Harrah’s Entertainment and world-renowned singer-
songwriter Jimmy Buffett unveil plans for Margaritaville
Casino & Resort, a $700-million-plus investment that
represents the single largest investment in Mississippi since
Hurricane Katrina.”
- Gulf Coast News (May 19, 2007)
For more information on the revival of the post-Katrina casino industry,
visit www.gulfcoastnews.com and click on “Current Casino Plans”
6
The need for affordable and habitable
housing is critical, and the government has
made $260 million available to encourage
investors.
FEMA programs are ending, evicting MORE THAN 101,000 Mississip-
over 30,000 families from temporary pians still live in government trail-
trailers, where they have been living ers, and over 40,000 families live in
since the hurricane disaster. temporary housing with family or
friends.
GOVERNMENT ASSISTANCE
can help builders and investors de-
“Yet amid primitive living conditions,
velop new properties. Currently, over promising signs of Mississippi’s comeback
$260 million is available to encourage are emerging. Federal money to help hom-
the construction of affordable rental eowners rebuild is pouring in, bridges are
housing. being replaced and hotel casinos reopened.
Schools are ready for children to return.”
Casinos
-USA TODAY
(June 25, 2006)
Driving Robust Economic Activity
Casinos Driving A Rebirth Of The Once-Ravaged Region
The extensive rebuilding after Hurricane Katrina has encouraged the growth of this important
economic asset. LARGE-SCALE CASINO EXPANSION is now taking place. After Katrina,
laws were changed allowing casinos to be built on dry land, ending the barge-only restriction.
Currently 8 casinos are open in Biloxi, with 4 under construction, and 8 more proposed. Casinos
are also open and operating in Hancock County, Bay St. Louis, and Gulfport. The casinos em-
ploy thousands of people - on average 2200 per casino - who will need affordable housing.
7
• Casino industry expected to require 40,000
employees
• 12 Casinos within 30 miles THOUSANDS OF PEOPLE will be
• Will be 3rd largest casino industry in the US working at these hotels, and other
tourist attractions. They have to live
somewhere, and they have to be able
- Tourism expanding due to Baby Boomers and to afford their homes! Currently the
casinos
shortage of affordable housing is acute.
- Defense industry infrastructure repaired and
growing; significant military presence in the area This translates into a great opportunity
- Long term outlook is promising, but some chal- for those who understand the future of
lenges remain the housing and property markets in
- Rental absorption far exceeds inventory the Biloxi area.
- Large employers in the area include Northrup
Grumman, Chevron, Dupont, Triton Systems,
and GE Plastics
NASA adding a research facility; shipyard
coming in with several thousand jobs
1 BEAU RIVAGE RESORT & CASINO - opened August 2006
2 SILVER SLIPPER - opened November 2006
3 ISLAND VIEW - opened August 2006
4 HOLLYWOOD CASINO - opened August 2006
5 BILOXI GRAND - opened August 2006
6 IP CASINO RESORT AND SPA - opened December 2005
7 ISLE OF CAPRI - opened December 2005
8 PALACE CASINO RESORT - opened December 2005
9 BOOMTOWN CASINO - opened June 2006
10 TREASURE BAY - opens Summer 2007
11 HARD ROCK HOTEL AND CASINO - scheduled to open
July 2007
12 ROYAL D’IBERVILLE CASINO AND HOTEL - approved
for construction
13 BACARAN BAY CASINO RESORT - $500 million project
scheduled for Fall 2008
14 BROADWATER - $1 billion project including casino, golf
course, 3,375 condominiums, 1,900 hotel rooms
15 Harrah’s - acquisition of old Casino Magic Resort
16 Proposed - Casino Resort & golf course
17 Proposed - Casino Condo/Hotel & Marina
PLUS - several casinos listed above are expanding their
facilities to include convention space, ballrooms, and other
facilities.
We Chose Modular
We Chose Modular
Home Developers
Home Developers
We have done significant research and have decided to use developers that are building
modular homes. Modular homes are already 90 percent built when they are delivered to the
site. The total building process costs between 10 and 30 percent less than a traditional home
construction project would cost. The reasons for the cost savings are many, and include a
W timelier construction schedule – and have decided to use developers that are building
e have done significant researchthere's no waiting for building materials or construction modular
homes. Modular homes are already 90 percent built when they are delivered to the site. The
workers to arrive on time – and 10 and 30 percent less than a or middleman sub-contrac-
total building process costs betweenavoidance of extra site workerstraditional home construction
tors who can The reasons for to home-building costs. The factory building process makes
project would cost.add significantly the cost savings are many, and include a timelier construction
construction rapid, and for building materials or construction workers to arrive on time – and
schedule – there’s no waitingmakes the most of minimal materials use – so, cost savings are
passed extra site the investor.
avoidance of directly to workers or middleman sub-contractors who can add significantly to home-
building costs. The factory building process makes construction rapid and makes the most of
minimal materials use – so, cost savings are passed directly to the consumer.
Perhaps one of the most attractive features of modular construction is the environmentally-
P friendly nature most attractive features of modular construction is the environmentally-
erhaps one of theof the home models. Many modular homes are "green" homes, made of
recycled materials and featuring utility cost-savings assets, like solar roofs and fluorescent
friendly nature of the home models. Many modular homes are “green” homes, made of recycled
materials and units. Modular homes are factory constructed and made of around 20lighting units.
lighting featuring utility cost-savings assets like solar roofs and fluorescent percent more
lumber than traditional homes. Thus, they tend to be tightly percent lacking in structural
Modular homes are factory constructed and made of around 20 built andmore lumber than
traditional homes. Thus, they tend to be tightly built and lacking in structural gaps or cracks that
hand-built homes some
some gaps or cracks that have. hand-built homes have.
Tight, costssoliddamage is minimal. modular homes areareare moreenergy efficient,atweatherThey also
construction produces living spaces that more energy efficient, overall.
Tight, construction produces living spaces that
save
solid
flooding, storm
longer-term: Because rough and
built to withstandto withstand rough
They also save money longer-term: Because modular homes are built
overall.
Furthermore, when a modular home arrives its Go Zone site
weather and flooding, storm damage is minimal. Furthermore, when a modular home ar-
pre-built, the waste materials that are typically the result of any construction project are reduced or
rives – its GO Earth-healthy move.
eliminated atanotherZone site pre-built, the waste materials that are typically the result of any
construction project are reduced or eliminated – another Earth-friendly benefit.
M uch media attention has been given to stars like Brad Pitt, who sponsor and champion green
Much media attention has as solutions stars like Brad Pitt, who sponsor and champion
and modular construction been given tofor re-building the Gulf Zone following Hurricane
Katrina. These stars have construction as Low-cost,for re-building the Gulf Zone followingsmart way to
green and modular the right idea: solutions Earth-friendly, flood-safe housing is a Hur-
rebuild New Orleans and the Mississippi GO Zone
ricane Katrina. These stars have the right idea: Low-cost, Earth-friendly, flood-safe housing
is a smart way to rebuild New Orleans and the Mississippi GO Zone.
YAERD.org has been negotiating with many developers in this area since March of
We have settled on two developers (for now) that area since March of 2007. We
2007.We have been negotiating with many developers in thiswe feel offer the best prices, quality
have settled on developer(s) that we feel offer the best Program highest-quality prod-
of product, familiarity with the Small Rental Assistance prices, the and time of delivery. We
have gone through great lengths to ensure YAERD.org members will be taken care of. Our
ucts, the best familiarity with the Small Rental our members including investor price
developers have agreed to special provisions forAssistance Program, and the most timely
delivery. We have can’t change the prices in the middle of will be taken care of. Our
protection (developer gone to great lengths to ensure our investorsthe build out) and time of
developer(s) have agreed to special provisions for home within a given investor time
delivery protection (the developer must build your our investors, includingperiod ofprice or you
protection (the developer can't monies refunded.
have the option to get all deposit change the prices in the middle of the build out) and time-
of-delivery protection (the developer must build your home within a given period of time).
9
Mississippi Gulf Coast Target Investment Areas
Developer is offering a range of single-family homes and a duplex model.
Harrison County
Harrison County is booming! The Gulf Coast
Business Council released a report about the
progress since Hurricane Katrina in 2005. Har-
rison County had 45% of all new jobs created in
the entire state of Mississippi during 2007. We are
focusing on the D’Iberville area, which is within
minutes to many different Casinos and Biloxi at-
tractions. Harrison County Schools systems are
rated at level 5, which is the highest rating given in
Mississippi. Majority of homes in this County are
single family and generally rented out by Casino
workers, or another local employers. This town
is experiencing an exciting future with two new
Casinos (TheMonarch & D’Iberviller Casino and
Resort) and further commercial development.
Single family home $156,900 Duplex $259,900
(two lots needed)
Jackson County
Jackson County is just across the bridge to the East
Hancock County of downtown Biloxi along the scenic highway 90.
This area offers quaint small towns feel with the
Hancock County is about 20 miles west of downtown historic downtown area of Ocean Springs.
Biloxi. We are focusing on Bayside Park in this county. We are focusing on Gulf Park Estates, which is just
Bayside Park is a new subdivision on the edge of Bay East of Ocean Springs and South of highway
St. Louis. This County was hit hard by the storm, but 90. This area offers the benefits of owning property
is making a strong comeback. Most of the commercial in Jackson County, while keeping lots affordable
stores like Wal-Mart, Lowes and Home Depot have been for maximum leverage and cash flow. This location
restored and open for business. There are also several also offers affordable insurance premiums due
large employers nearby such as the NASA Stennis to its location. Gulf Park Estates offers a mix of
Space Center, Hancock County Hospital (3 miles) and single family and duplex homes. This development
Dupont Industrial Park (7 miles). This is a scattered is close to highway 90, which allows it quick ac-
lot development with about 7,000 lots available. It is cess to both downtown Ocean Springs and down-
designed as a scattered lot development to keep the town Biloxi.
aesthetic appeal unique. This is an upcoming area with
affordable lots that allow investors to maximize their Single family home $156,900 to $164,900 Duplex
leverage and cash flow. $244,900 to $259,900
Single family home $139,900 Duplex $244,900 to
$249,900
10
The Patriot
The Patriot starting at
$1 39,000
ROI
True
%
= 227 OC
C
True
%
= 119
11
: Large vanity cabinets in both baths. : Both baths feature one piece large
The Patriot Features : Matching towel bars and toilet tissue
paper holders.
32” fiberglass tub/shower units.
: All floor joist plumbing is enclosed in
insulation.
: Wilsonart postform laminate tops in
and Specificiations kitchen.
: Custom Beaumont white double
: 50 gallon quick recovery energy ef-
ficient electric water heater.
: Shut-off valves at all water supply
kitchen sink.
: Whirlpool 30” large capacity electric connections.
range with clock. : ANSI approved overflow – all tubs
STRUCTURAL : R-9 insulated (duct butter sealed) : Lighted vent hood with micro-wave and bathroom sinks.
Structurally Rated (150 MPH) heat/air metal duct in the attic (no oven.
: Pre-engineered combination lifting flex). : 1/3 h.p. food disposal. HEATING, VENTILATION AND
attachment and perimeter floor joist : Sheathing is fully covered in house AIR CONDITIONING
system includes one 2” x 8” treated wrap vapor barrier for maximum ELECTRICAL : Quality split system up flow unit (2
board sandwiched between two 2” x protection. : All electrical meets or exceeds the ton cooling/heat pump 8 KW electric
10” treated boards that are glued and : Fiberglass insulated 2” x 6” walls National Electrical Code 2005 Edition. heat or a 3 ton cooling/heat pump
fastened with 4” screws (patent pend- have an R factor of 21. : For safety, all electrical wiring is #12 15KW electric heat
ing process). : Low “E” vinyl double pane thermal copper or better. Builder to furnish and install: 13 Seer
: 2” x 10” floor joist are 16” on center windows, with screens. : Built-in telephone/high speed inter- or better outside condensing unit.
(glued and fastened with 4” screws). : Insulated front, side and rear doors net/cable connections in all bedrooms,
: 3/4” tongue and groove sub-floor with thermal break thresholds. kitchen and family room. EXTERIOR FINISH
(glued and fastened to floor joist with : Glass storm doors on utility door and : All bedrooms are safety protected : Soffet and fascia are vinyl/metal.
2 ½” screws). back door. with “Arc-Fault” breakers. : The front or back porch is 5/4” MCQ
: All floor joists are treated in accor- : Two outside weather proof ground- : Upgrade silent rocker wall light deck board.
dance with AWPAC22. fault interrupter electric receptacles. switches. : Entire home is wrapped in a quality
: 2” x 6” exterior studs are 16” on : Frost-free water hose bibb with back- : Electric smoke detectors with battery vapor barrier house wrap ready for
center (glued and fastened to sub-floor flow preventer. back up. the builder to apply the final exterior
with 4” screws). : Front and rear porch lights. : Ground-fault interrupter receptacles finish.
: Double top plates. : Outside electric panel (ready for in all wet areas.
: All load bearing headers are solid public power hook-up) : All Receptacles serving the kitchen WARRANTY
wood. : Single source outside box for counter tops are GFCI protected. : The Home is fully covered by a war-
: Double 2” x 10” porch headers are telephone/cable/high speed internet : 200 amp panel. ranty underwritten by Bonded Builders
counter levered and finger jointed. connection. : 42” fan with light kit / owner’s Warranty Group.
: All exterior 7/16” oriented strand : Dryer vent trim. bedroom.
board sheathing is glued and fastened : 52” fan with light kit / family room. APPLICABLE CODES
with 2” screws to each stud on all INTERIOR : Metal ceiling fan mounting brackets 1. The National Electrical Code, 2005
eight sides. : R-19 fiberglass insulated 2” x 10” in all bedrooms. edition, published by the National
: Double marriage wall is joined at the floor joist. : Decorative light fixtures throughout. Fire Protection Association (NFPA),
center to form a 9” wall for superior : 2” x 4” studs are 16” on center. : Under the cabinet fluorescent light Batterymarch Park, Quincy, Massachu-
structural stability. : Full eight foot ceiling height. over the kitchen sink. setts 02269
: 2” x 4” interior studs are 16” on : 4” ceiling crown molding throughout. : Energy efficient fluorescent light 2. The International Building code,
center. : 1/2” sheetrock is attached to all studs bulbs in all fixtures. 2003 edition and 2006 edition,
: All gypsum board is fastened to studs and ceiling rafters with expanding hot : Custom four bulb fluorescent light published by the International Code
and ceiling rafters with a two part (ex- foam adhesive for maximum strength. fixture in kitchen. Council (ICC) formerly the Southern
panding hot foam) adhesive. Nails and : All ceiling sheetrock is primed with : Hanging chandelier in dining area. Building code Congress International,
screws used only on back panels. vapor barrier sealant. : Vented bath exhaust fans. Inc. (SBCCI) 900 Montclair Road,
: Pre-engineered roof truss body is : Upgrade rounded “Bull Nose” sheet- : Front door chime. Birmingham, Alabama 35213
attached to the double top plates with rock corners. 3. The International Residential Code,
26 gauge uplift straps. : Steel protective plates to cover all PLUMBING 2003 and 2006 edition, published by
: Pre-engineered roof cap system is plumbing and wiring exposures. : Premium RHAU PEX fresh water the International Code Council (ICC)
strapped to each truss (patent pending : Window jams feature wood casing tubing is pressure tested and water 900 Montclair Road, Birmingham,
process). and wood trim molding. tested in our factory. Alabama 35213
: Architectural interior doors that : 3/4" RHAU PEX fresh water tubing 4. The International Mechanical Code,
EXTERIOR match kitchen cabinet doors. through-out, then 1/2" to fixtures at- 2003 and 2006 edition, published by
: Full 6/12 roof pitch. : Privacy lever lockset on all bedroom tachment. the ICC
: 30 year architectural asphalt 6 tab and bath doors. : Washer and Dryer connections 5. The International Plumbing Code,
shingles. : 4 1/2” baseboards in every room. : Whole house water cut-off valve in 2003 and 2006 edition, published by
: Premium one piece roof felt. : Owners closet features a transom low utility room. the ICC
: 15/32” oriented strand board roof “E” window. : PVC waste pipe is glued and water 6. Southern Building Code Congress
deck with full attic radiant barrier : All closets are walk-in with indi- tested in our factory. International Standard for Hurricane
protection. vidual ceiling lights. : Refrigerator ice maker connection. Resistant Residential Construction
: Builder to install R-38 stabilized : Closet shelving is white vinyl cov- : Porcelain elongated commodes. (SSTD 10) or Minimum Design Load
blown cellulose insulation in the attic. ered metal with heavy duty supports. : Custom dual-lever chrome faucet in for Buildings and Other Structures
baths. (ASCE-7).
: Premium single-lever white faucet in
12 kitchen with spray.
The Duplex
The Duplex
The Duplex244,900
starting at
$
OI
True R
%
= 165 OC
C
True
%
= 118
The Duplex Features
and Specifications WINDOWS AND DOORS
: Energy efficient thermal panel tilt out Moss windows
: Dead bolt locks front and rear doors
: Raised six panel, pre-hung interior doors triple hinged
: Metal interior door knobs
: 3.0 x 6.8 six panel steel front door
: 3.0 x 6.8 six panel steel rear door
ENERGY EFFICIENT FEATURES
: Thermopane insulated windows by Moss
: Owens Corning Craft Backed R-13 side wall insulation
Atwood Floorplan Duplex : Blown in R-30 ceiling insulation
: Double 2 x 10 edge bands on floor system : Energy Star high efficiency 40 gallon water heater
: 16” OC floor joist spacing : Energy Star Whirlpool 5 cycle dishwasher
: 2 x 10 yellow pine floor joist : 18 cu. Ft. Whirlpool frost free refrigerator w/ icemaker
: 3/4 “ tongue and grove plywood floor decking : Gasket close up system
: All floor decking glued and nailed : Owens Corning pink house wrap
: 6/12 hinged roof truss system
: 8 foot flat ceilings though out INTERIOR
: Case opening marriage seams where possible : Professional coordinated decors by Glidden
: 1/2” finished drywall walls : Optional custom Glidden colors available
: 1/2” high density drywall ceilings : Designer coordinated window treatment
: 3 x 5 over sized thermopane windows all areas except kitchen : 2” faux wood mini blinds
: 2 x 3 oversized thermopane tilt out windows in kitchen : Textured finished 1/2” sheetrock walls
: OSB exterior wall sheeting : Designer coordinated glass light features
: OSB roof decking : Stain resistance plush carpet by Shaw
: Closet Maid shelving all closets : Tack strip installed carpets
: Triple hinged interior doors : Heavy rebond carpet pad
: Tack strip carpet : Designer coordinated vinyl no wax floor covering by Congoleum
: 2 x 6 fascia band : Painted wood 4” crown molding all rooms
: Plywood floors glued and nailed : Painted wood 3 1/2” base board molding all rooms
: 16” OC interior wall construction : Pained 2 1/2 “ wood high profile door facing
: 16” OC exterior wall construction : Flush mounded pre-hung six panel interior doors
: Luan sheeted marriage wall behind sheetrock : Floors mounted interior doors stops
: Solid 2 x 4 studs on exterior walls : Textured finished 1/2 sheetrock ceilings
: Solid 2 x 4 studs on interior walls : Painted wood interior door jams
ELECTRICAL
: Total electrical EXTERIOR
: 200 amp extra large 40 circuit Square D electric panel : Stylecrest maintenance free vinyl siding
: Interconnected electrical smoke detector with battery back up : Maintenance free metal facial
: Ground fault interrupter breaker all wet areas : OSB exterior wrap
: 10-2, 12-2 solid copper plug and switch wiring : Color coordinated vinyl shutters front door side
: Glass light globs through out (no plastic) : 2 x 6 facial framing
: Strip light fixture over vanity (when space allows) : Vented vinyl soffit
: Chandelier in dining room : 30 year Owens corning architectural shingles
: Light fixture over kitchen sink : 6/12 roof pitch
: Standard size and type plugs and switches
: 220 wired for electric dryer KITCHEN
: Wire proctors installed on all studs : Aristokraft components style cabinet with manufacture warranty
: Wires sealed air tight though floor : 5 year warranty on cabinets
: Wires sealed air tight through ceiling : Hardwood cabinet doors and styles
: Nail on electrical boxes for switches : Durable hidden cabinet hinges
: Nail on electrical boxes for plugs : Adjustable overhead shelves in cabinets
: Nail on electrical boxes for light fixtures : Drawers over base cabinets
: Exterior lights at all entrances : Crown molding finish on all over heads
: ARC fault breakers in bedrooms
True Cash on Cash Return
TrueCash on Cash Return
Cash Flow After Tax
Rental Income Rental Income
$25,000 Cash Investment
$28,800 $28,800
$219,900 Bank Loan
Less Operating Expenses Less Operating Expenses
$244,900 Property
$4,756 $4,756
(7.25 Int @ 30 yrs)
Less Debt Service Less Debt Service *
$18,000 $15,873
Regular Depreciation **
$4,125
Bonus Depreciation ***
$113,450
Paper Loss ($109,404)
Positive Cash Flow = $4,416
Tax Savings @ 25%
Cash on Cash Return = 17.6%
tax bracket = $31,671
$4,416 + $25,000**** = $29,416
118% is the True Cash on Cash Return
*Only the Interest is tax deductible
**Assuming the straight-line residential depreciation method (improvement divided by 27.5 yrs).
***If your adjusted gross income isn’t enough to use all available depreciation, you can carry it forward.
****If your adjusted gross income is under $100,000, you can offset up to $25,000 of your ordinary income from
losses in real estate. This is true for both single and for married individuals filing jointly.
Please consult your tax advisor
TOTAL RETURN ON INVESTMENT
TRUETrue Cash on Cash Return
(CF + AP + LR + TS) / DP = True ROI
CF = Cash Flow
AP = Appreciation
LR = Loan Reduction
TS = Tax Savings
DP = Down Payment
Criteria
Purchase Price $244,900
Down Payment $25,000
Interest Rate 7.25%
Appreciation 4%
Tax Savings $25,000
Cash Flow $4,416
Loan Reduction $2,128
($4,416+(244,900*.04)+$2,128+$25,000 = $41,340
$41,340 / $25,000 = 165%
165% is the True Total Return on Investment
**If your adjusted gross income is under $100,000, you can offset up to $25,000 of your ordinary income from passive losses in
real estate, but there isn’t a cap if you qualify as a real estate professional under tax code. Please consult your tax advisor.
***If your adjusted gross income isn’t enough to use all available depreciation, you can carry it forward.
Please consult your tax advisor
Additional
Additional
Information
Information
All prices, floor plans, and dimensions
in this document are subject to change
without notice. Use of GO Zone bonus
depreciation will vary, depending on
each buyer’s individual circumstances.
Consult with your tax advisor. Nothing
in this document may be relied upon
as tax advice, and no statements herein
are made for the purpose of tax avoid-
ance. The Mississippi Small Rental Assis-
tance Program must be applied for, and
is subject to approval by government
agencies. All incentive programs and loan
programs are subject to restrictions and
change without notice. All information
in this document regarding government
programs, market demographics, mar-
ket economics, and future expectations
is from third-party sources, and has not
been independently verified. Buyers are
responsible for conducting their own
diligence, and may not rely solely on
the information herein. This document
contains forward-looking statements; any
forward looking statements are based on
assumptions, and are speculative. For-
ward looking statements, by their nature,
involve substantial risks and uncertain-
ties, and actual results may differ materi-
ally, depending on a variety of factors.
Appraisals and property values may
change significantly over time.
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