So I have been doing tons of research and talking to a lot of investors in my area.
I wanted to see what you guys think. When I start buying rental property my goal was to cash flow 400-500 Dollars. Is this possible after all expenses?
How much do you guys average on cash flow with your properties?
I'm looking to start off on single family homes and getting some multi family properties eventually as well.
Yes it is possible but I am not sure about in your market. . It depends a lot on your market. There are many other variables that play into it as well. I believe it takes a great deal to get $400 or more Cash Flow on a Leveraged SFH but I have done it.
Hope this helps ya!
Awesome thank you!
You're welcome! Glad I could help!
Definitely possible. In my markets, an acreage property rented to someone with poor credit 3 dogs 2 cats 2 goats and a horse on a month-to month basis can easily achieve that.
If you have no mortgage that should be relatively easy to obtain, especially if your rents are above $800 a month. Also, if you have substantial rents say $2,000 a month or more and if you have a mortgage it is less than $500 a month you should be cash flowing $400-500 a month also.
@Kyle Evans - Which area are you thinking ? Sure I can say $1000 cash flow is also possible , but I can say because it worked for may not work for you. If you can give specific details on the area, financing , timeframe, your strategy then you can get concrete feedback from people who are in your area and have been doing it for years.
Also for mentor , I would suggest to start thinking on what are you bringing to table for someone to guide you through the process.
It is fairly easy in my area to achieve that if you do not have a mortgage payment. I am achieving $100 - $200 or so cash flow with payments on 5-10 year loans.
@Kyle Evans Very possible depending on location, financing, and other fees. Everyones strategy is different with a great deal of folks looking for 100-200 per door, frankly I'm shooting for $1000 per door in about 3 more years, after tenants basically bought them.
Depends on the area but 400-500 net, with a leveraged property in my short experience is unlikely.
If you manage yourself(saving 10 percent), good deals can probably get you closer to 300-350, using 40 percent expenses and 30 yr fixed mortgages.
This is for non war-zone areas. But even a single family in a war zone, isn't going to do this much.
I'm a newbie, but as a general rule, 100 dollars per house is considered the minimum for net cash flow, 200 is considered good, anything above 200, is exceptional. This is after accounting for all expenses using the 50 percent rule.
Thanks everyone for the feedback it really helps!
Love talking to people that are already doing what I want to!
Its totally possible, especially if you're willing to put in some work and build some equity for yourself. When I buy properties, they have to meet my 3 financial criteria before I consider them
1 after reno cost of 15k-20k per unit
2 400+ per unit monthly cash flow
3 25%-33% ROI (I will also accept higher hah)
These numbers worked for me, but I buy cash, put in a lot of sweat equity, and manage myself
Wow @Matt R. those are some great numbers!
Thats my long term plan as well but at the moment I don't have enough to purchase a house cash.
Great job and good luck!
This can easily be done, I've never put an investor into something that he wouldn't make a 7% cap or 10%+ cash on cash return.. contact me if you want some examples or spreadsheets to take a look at.
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