Rental Property putting minimum down vs paying all cash
I am looking to purchase my first rental property and wanted to know thoughts on paying the minimum down payment vs paying all cash. I will lay out the scenario...
Purchase price of condo $130,000
Down payment $30,000
Monthly HOA+Taxes $500
Monthly rent $1500
If I take a 30yr loan, I will be making approximately $500 net per month.
This is a $6,000 / $30,000 = 20% return on the investment of $30,000
If I pay all cash...
I will be netting $1,000 per month
This is a $12,000 / $130,000 = 9.2% return on the investment of $130,000
My question is "which is better?"
One part of me says that its better to use other people's money to make money. If I put all my cash into it, I will not have much left to buy anything else.
Any thoughts would be appreciated.