How Much to Keep Liquid?
Hey, guys. I want to know how much money you keep available for contingencies on your SFR rentals.
I have two SFR's, with a third (current residence) to be rented within a year. With the two rentals, I've never taken a dollar out of the business, with the exception of repairs and maintenance. I don't manage them myself, and just stack up the cashflow for now. They each have about $17k saved from just cashflow. Rent check goes in, mortgage comes out, remainder sits. That comes to 18-24 months of mortgage payments for both properties, if they were vacant.
I'm looking at a possible cross-country move in a year, so I'm in cash-savings mode, and not looking to invest in property until then. At that point, I'm planning to house hack a multi-family.
The question is, how much of my roughly $34k (plus another year of cash-flow for each) do I need to keep in the properties for contingencies (cap-ex, minor maintenance, etc) and how much is available to put toward a down payment? Keep in mind, I have savings outside the business that I'll also contribute to the down payment, but this isn't about the amount I can put down, it's about how much to keep in reserve for the properties.
Thanks,
Colin