Monthly Net Profit in Texas

[Joe Taft]

I finally got my first property renovated and rented! What's a good percentage or dollar amount to target for monthly cash flow?

My mortgage + taxes + insurance is $1600 and I'm charging $1900 for rent.

Also, is the property tax a write off? How much can I get back?

[Andrew Postell]

@Joe Taft Thanks for posting here.  Always great to hear from a fellow Texan as well.  Bigger Pockets has a pretty active Texas forum if you ever want to post there or just follow that forum.  

Now, if you rent your property for $1900 and your mortgage is $1600...your cash flow is NOT $300...it is $15.  Well, if you are using a 15% expense ratio that is.  Being able to calculate your true cash flow is CRITICALLY important to finding profitable deals. In the Dallas - Fort Worth area we try to target sub-$200k properties because those cash flow better than properties worth over $200k. And we also target off market properties to use the BRRRR method. The things I cannot tell here that are important...what is the value of your home? Bed/Bath/Garage count? This is generally the best method to finding comparable rents. Meaning, is $1900 too low or too high? If your home value is $300,000...then you are WAY too low. If the value is $160,000 then you are WAY too high. I hope this is making sense.

Truthfully, how successful investors target rentals here in DFW is generally 1% of the cost = rent amount, leaving 25% or so in equity while not coming out of pocket more than a few thousand. 

Anyway, I probably gave a lot of information here but I hope some of this makes sense in some way.