Here's how:-Property Management (10%): Manage the property yourself. Can be done locally or out of state. (Suggest reading Brandon Turners book, managing rental properties).
-Capex (5%): If the roof and hvac have enough life on them and you plan to sell after a few years of appreciation you can risk removing cap ex. from the cost structure.
-Vacancy (5%): I currently average 7 days per 24 months on my properties in this area. If you price the property correctly you can expect multiple qualified applicants.You will still have some vacancy but it doesn't need to be 5%. Some are better at filing vacancies than others.
Maintenance: Some properties are more turn key then others. They will all need work at some point. I do a lot of the work myself on the proerties I own. Clearly not for everyone and I still spend plenty on HVAC maintenance and more complicated repairs.
Many will point out that this becomes a job and they are certainly right. I don't plan to do it forever but as long as I can find the time and have strong back and work ethic I try not to pay anyone to do a job that I can do myself (except painting, I hate painting).
Originally posted by
@Chris London:
@Annamalai Karthik
204 Sunshine Crest Apex:
PITI: $1557/mo (20% down at 4% & $600/yr insurance).
5% capex, 5% maint, 5% vacancy: $300
10% prop mgnt: $200
Rent:2,100/mo (in spring and allowing pets)
Apex home values have gone up 29.7% YoY.
You can have non-zero positive cash flow and speculative appreciation in Apex NC.
Good luck & LMK if I can help.
-C