Have the rising interest rates hurt your cash flow in Memphis?

[Faraaz Siddiqui]

I know Memphis has historically been a great place for investors due to the great cash flow, but I wanted to hear from investors who have recently bought rentals about their cash flow? I've been analyzing deals and noticed the numbers have taken quite a dip. I'd be interested to hear your thoughts and experience in this current market

[Matthew Crivelli]

If you are using financing to purchase rentals then your cashflow has taken a hit no matter the market you buy in. We were doing 30Y non owner occupied loans in the 4% range for years, now that same loan is 7%. This is not market specific. @Faraaz Siddiqui   

[Alex Evans]

Hello @Faraaz Siddiqui

I agree entirely with what Matthew stated above as well. This is not just here in the Memphis market, and it is happening in every market across the country. 

If your main strategy is cash flow, and you are looking to improve those numbers you may want to look into an interest-only type of loan. This is a loan where you will only be paying the interest payments for a certain period, such as 5/7/10 years. Once that time is over you can keep that loan, refinance into a different type of loan, or sell the property. 

I would be more than happy to make a recommendation for you! Feel free to reach out!