Assume you buy your house today with a fixed rate

Assume you buy your house today with a fixed rate interest only loan, and keep the property indefinitely. 

(a) If you buy this property at the asking price, what is the NPV of your investment with 6% after tax discount rate? 

(b) What is the IRR? 

Property Details Bedrooms 3-4 Bath 2 Sq. 

Footage 2,000.00 

Lot Size 5,000.00 Avg. 

Rent 6,500.00 

Avg. Sale 1,500,000.00 

Assumptions Rent Inflation 3.00% 

Maintenance 1.00% 

Maintenance Inflation 1.00% 

Property Tax 1.25% 

Property Tax Inflation 2.00% 

Closing Costs 1.00% 

Required 

Rate Return 6.00% Down Payment 20.00% Interest Rate Mortgage 3.50% Federal Tax Rate 35.00% State Tax Rate 9.30%