Peter Quinn is considering purchasing a home for ($200),000 and flipping it in three years. The expected

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Peter Quinn is considering purchasing a home for $$200$,000 and flipping it in three years.

The expected rent is $$2$,000/month and expenses are $$100$/month. Mr. Quinn anticipates a rental increase of 2.0% per year, an expense increase of 3.0% per year, and a terminal cap rate in year 3 of 8%. Mr. Quinn expects to borrow 70% from a traditional lender using a conventional 25-year fixed rate mortgage at 4.0%, amortized annually. If he anticipates a discount rate of 10% and a reinvestment rate of 2%, determine the following: (must develop an annual pro forma showing ALL work). Note: IRR and NPV should be calculated using the HP-12C and not by hand. MIRR is by hand.

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