rei-deal-analyzer

REI Deal Analyzer

Disclaimer: This skill produces financial analysis for informational and planning purposes only. It is not a substitute for advice from a licensed financial advisor, real estate professional, CPA, or lender. All figures should be independently verified by qualified professionals before making investment decisions.

Overview

Analyzes any real estate deal and delivers a comprehensive financial breakdown with a clear go/no-go recommendation — scored against your personal buy box criteria, not just generic benchmarks. Covers cash-on-cash return, cap rate, DSCR, monthly cash flow, GRM, break-even occupancy, 1% rule, and ROI. Supports multiple financing scenarios side by side (conventional, FHA, hard money, creative finance, subject-to, seller finance). Reads saved property research from cloud brain when available.

When This Skill Applies

• User provides a property address and asks "is this a good deal?"
• User gives purchase price, rents, and financing terms and wants analysis
• User wants to compare conventional vs. creative financing on a deal
• User asks for cash flow, cap rate, or cash-on-cash return
• User says "run the numbers on this"
• User asks "should I buy this property?"
• User wants to underwrite a multi-family or commercial property
• User provides a deal and wants a go/no-go recommendation
• User mentions subject-to, seller finance, or wrap mortgage analysis
• User asks about DSCR, break-even, or debt coverage on a deal

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Pre-Flight — Investor Preferences

1. Use mcp__cloud-brain__search_notes with query REI preferences

2. If found: Load saved preferences. Display banner with investor name, target markets, strategy focus, and personal thresholds (min CoC, min cash flow/door, target cap rate, min DSCR). Confirm or offer to update. All scoring in this analysis will use these thresholds — not generic defaults.

3. If not found: Ask in ONE message:

   "Before I run this analysis, let me save your investor profile so every deal is scored against your personal targets. Tell me:

   • Your name and contact info
   • Target markets (city/state)
   • Investment strategy focus (LTR, STR, BRRRR, flip, creative finance, mixed)
   • Property types (SFR, multifamily, commercial)
   • Target price range
   • Min monthly cash flow per door (e.g., $200)
   • Target cash-on-cash return (e.g., 10%)
   • Target cap rate (e.g., 7%)
   • Min DSCR (e.g., 1.25)
   • Financing preference (conventional, creative, cash)"

   Save to brain/preferences/rei-preferences.md via mcp__cloud-brain__write_note. Proceed.

4. Check for prior property research: Use mcp__cloud-brain__search_notes with the property address slug. If a research dossier exists, load it and note: "Found saved property research from {date} — using that data."

5. Show ⚙️ Preferences Active banner at top of output.

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How It Works

Step 0: Gather Deal Inputs

Parse what the user provided. Required inputs — ask for anything missing:

Input	Required	Example
Property address or description	Yes	"123 Main St, Dallas TX"
Purchase price	Yes	$150,000
Estimated monthly rent (gross)	Yes	$1,800/mo
Financing type	Yes	Conventional, FHA, hard money, seller finance, subject-to, cash
Down payment or cash to close	Yes (unless cash)	20% or $30,000
Interest rate	Yes (unless cash)	7.5%
Loan term	Yes (unless cash)	30 years
Estimated rehab cost	If applicable	$25,000
ARV	If applicable	$200,000

If the user provides an address but not comps/rents, use WebSearch to find estimated values.

Step 1: Research (if address provided and no brain data)

Use WebSearch to pull:

• Recent comparable sales (within 0.5 mi, last 6 months)
• Current rental listings for similar properties
• Property tax estimates
• Insurance cost estimates

Step 2: Set Expense Assumptions

Use researched data or conservative defaults (note which are assumed):

Expense	Default	Notes
Property taxes	1.2% of purchase price/yr	Adjust from research
Insurance	0.5% of purchase price/yr	Adjust for flood zone, state
Vacancy	8% of gross rent	5% hot markets, 10%+ soft
Maintenance / repairs	10% of gross rent	Higher for older properties
CapEx reserves	5% of gross rent	Roof, HVAC, water heater
Property management	10% of gross rent	Include even if self-managing
HOA	$0 unless specified	Ask if condo/townhouse

Step 3: Calculate Core Metrics

Gross Rent Multiplier (GRM)

GRM = Purchase Price / (Monthly Rent × 12)
Below 8 = Strong | 8–12 = Market dependent | Above 12 = Weak

1% Rule Check

Monthly Rent / Purchase Price ≥ 1%

Net Operating Income (NOI)

NOI = Gross Annual Rent − Vacancy − Operating Expenses (no debt service)

Cap Rate

Cap Rate = NOI / Purchase Price × 100

Debt Service (Monthly P&I)

M = P × [r(1+r)^n] / [(1+r)^n − 1]

Monthly Cash Flow

Cash Flow = Monthly Rent − Vacancy − Monthly Expenses − Monthly Debt Service

Cash-on-Cash Return (CoC)

CoC = Annual Cash Flow / Total Cash Invested × 100
Total Cash Invested = Down Payment + Closing Costs + Rehab (if any)

DSCR

DSCR = NOI / Annual Debt Service
Below 1.0 = Negative | 1.0–1.2 = Tight | 1.2–1.5 = Healthy | 1.5+ = Strong

Break-Even Occupancy

Break-Even = (Operating Expenses + Debt Service) / Gross Potential Rent × 100
Below 75% = Very safe | 75–85% = Acceptable | Above 85% = Tight

Total ROI (Year 1)

ROI = (Cash Flow + Principal Paydown + Appreciation) / Total Cash Invested

Step 4: Run Multiple Financing Scenarios (if requested)

Metric	Conventional 20%	FHA 3.5%	Seller Finance	Subject-To	Cash
Cash to close
Monthly payment
Monthly cash flow
Cash-on-cash
DSCR

Creative finance notes:

• Subject-To: Use existing mortgage terms. Cash to close = purchase price minus existing loan balance.
• Seller Finance: User-defined terms. Calculate both P&I and interest-only cash flows.
• Hard Money: Short-term bridge (6–18 months), higher rates (10–14%). Include points as upfront cost.
• Wrap Mortgage: Underlying loan + seller spread. Show all-in effective rate.

Step 5: Score Against Investor's Personal Buy Box

Use the thresholds loaded from preferences (not generic defaults). Score each metric:

Metric	Your Target	This Deal	Signal
Cash-on-Cash	[saved pref]	X%	🟢 / 🟡 / 🔴
Monthly Cash Flow/door	[saved pref]	$X	🟢 / 🟡 / 🔴
Cap Rate	[saved pref]	X%	🟢 / 🟡 / 🔴
DSCR	[saved pref]	X.X	🟢 / 🟡 / 🔴
1% Rule		Meets/Misses	🟢 / 🔴
Break-Even Occupancy		X%	🟢 / 🟡 / 🔴

Verdict:

• 5–6 🟢 = STRONG BUY
• 3–4 🟢, rest 🟡 = GOOD DEAL (note the risks)
• Mixed 🟢/🟡/🔴 = PROCEED WITH CAUTION (specify what needs to change)
• 2+ 🔴 = PASS (explain why; show what price/terms would make it work)

Always include: "What would make this deal work" — the price, rent, or terms needed to hit your target returns.

Step 6: Save Analysis to Cloud Brain

Path: brain/deal-analyses/{address-slug}-{YYYY-MM-DD}.md
Tool: mcp__cloud-brain__write_note

Tell the user: "Analysis saved. Run rei-investment-calculator for deep financial modeling, rei-rental-analysis for a rental strategy comparison, or rei-offer-generator to draft your LOI."

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Output Format

⚙️ Preferences Active | Investor: [Name] | Strategy: [Focus] | Targets: CoC [X%] | CF $[X]/door | Cap [X%] | DSCR [X.X]

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# Deal Analysis: {Address}
**Date:** {date}

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## Property Overview
[Property details table]

## Financing Terms
[Financing table]

## Income & Expenses (Monthly)
| Item | Amount |
|------|--------|
| Gross Rent | |
| − Vacancy (X%) | |
| − Property Tax | |
| − Insurance | |
| − Maintenance | |
| − CapEx Reserve | |
| − Property Management | |
| − HOA | |
| **= Net Operating Income** | |
| − Debt Service | |
| **= Monthly Cash Flow** | |

## Key Metrics vs. Your Buy Box
[Scoring table with personal targets]

## Recommendation
**Verdict: [STRONG BUY / GOOD DEAL / PROCEED WITH CAUTION / PASS]**
[Explanation]

### What Would Make This Deal Work
[If not STRONG BUY — the price, rent, or terms to hit targets]

## Comparable Data
[Comps from research or web search]

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*REInvestor Toolbox — Deal Analyzer | Saved to brain/deal-analyses/{slug}*

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Error Handling

• No purchase price: Ask specifically before proceeding.
• No estimated rents: Search via WebSearch; if unavailable, ask.
• No financing terms: Ask: financing type, down payment, interest rate, term.
• Negative cash flow: Don't just say PASS. Show the price, rent, and rate that would break even and hit targets.
• Unrealistic inputs (e.g., 1.5% conventional rate): Flag and proceed as-is with a note.
• Subject-to but no existing loan terms: Flag — need existing balance, rate, payment, remaining term.
• Unusual calculation results: Double-check inputs and flag to user before displaying.