Strategies on using cash flow on rentals

5 Replies

I am 31 and own 3 rental properties and cash flow at least 250 on each. 

Wanted to see what others do with the cash flow, I DO NOT need the cash flow for living. I make 400k+ a year and I live off that and buy rentals with that as well. 

My goal is to buy 3-4 rentals each year until I get 50+ units. I will probably move into multi-family and apartments at some point.

I have 3 loans with a balance of 76k, 110k, and 142k. My thoughts were to use the cash flow from all 3 to pay down the 76k loan first and just pay the minimum payment on the other 2? Good strategy or not? 

Currently I just pay monthly on each not exactly what I get in rent. I have also not re-fi any of these, if I did I could pull out 50+ on each. 

Any thoughts would be appreciated...

I personally would use this money towards downpayments on more investment properties.

I don't know that you have enough equity in these so that it would make much since to do a refinance unless you could get a much better rate.

@Mark Smithey The Fed are expected to cut rates again, so money will be quite cheap over the next few months. I’d refinance them all, lock in the lower rates, and use the money to get into a multi family. Given you already have 3 units, I’d say you have a good amount of experience, so getting in the multi family now will help you reach to your goal faster. Listen to episode 108 on the BP Podcast

Most people that make $400k+ per year would not be interested in 50+ individual units. They typically invest in something more passive...or they reinvest in the business that makes them $400k+ per year.