ProCash, an Economic Model for Income Properties

Projection of Operating Income & Expense

Certain additional inputs are available for the projection of income and expense for years into the future. In addition to those listed below, MV[6] as the rate to earn interest on reserve for capital improvements and MV[17] as the rate to increase ground rent deserve attention.

Four reserves are provided for in ProCash©. Two are created in original financing and two are created from rental income. All can earn interest except working capital. Working capital and operating reserves are documented in the topic "Acquisition or Development Costs". The acquisition reserve is described more fully in the topic "Special Inputs for Housing".

Source of Funds Input for Input for:

Deposits Interest 
Working Capital from financing AVI[45] none 
Operating Reserve from financing AVI[46] AVI[47] 
Capital Improvements Reserve from rents AVI[60] MV[6] 
Acquisition Reserve from rents AVI[121] MV[63]

Also see: Inflation & The Urbanization Factor

OM[;7]Oper. budget: Forego 334  1
AVI[185]Rate to earn interest on acquisition reserve 334  1

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