Theoretically, THE EASIEST $100,000 YOU WILL EVER MAKE!

I wrote a Blog a few years ago entitled: “The Stars have aligned for Solar Panels on Apartment Buildings.” At that time I was excited about the development of Virtual Net Metering: a method in which one solar power system feeds one master meter, sending electricity back to the grid. The power company then applies the credits from that energy to each of the tenants in the building, thru sub-meters, offsetting each tenant’s electricity cost. 

Recently I completed the National Association of Realtors GREEN designation course, I highly recommend this class. At any rate, I became aware of two more profound positives for making apartment buildings energy efficient. Fannie Mae has come out with their Green loan program, which among many great features has the ability to finance future GREEN improvements in a purchase or refinance loan, plus discounted preferential pricing!

The second light bulb was a graph demonstrating how solar and renewable power are now less expensive in many cities than conventional electricity rates.

How does this all work together to create $100,000?

Example: You own or purchase a 10 unit apartment building. You spend $50,000 on retrofits and solar panels. Your additional loan payment on $50,000 @4% 30 years = $238 per month. You change your leases to collect the electric bill form your tenants: 10 units x $60 electric bill per month x 12 months = $7,200 increase in annual rental income, less $2,856 loan pmt.  = $4,344 EXTRA annual income. You also reduced your water heating, lighting, and interest rate expenses roughly $4,000 per year.

Additional net income of $8,344 per year at a 5 cap rate = $166,000 equity.

THANK YOU FANNIE MAE!