Updated over 9 years ago on . Most recent reply
Check my math
So if I have a 3 unit cash flowing $100 per door, I am making $3600 annually on that building. I would need 10 of these buildings (30) units to make $36,000.
I assume there are various tax incentives and such that may add to the benefit but all in all.. that seems like a lot of work to make a minuscule profit.
What am I missing? There has to be more to it or so many people wouldn't be doing this.
Most Popular Reply
$3600 per year may seem like nothing, but in 10 years once that property is paid off and you will be making a lot more. I have one client who is currently netting $500 per month on an investment property. Once the mortgage is totally paid off in a few years he will be netting $15k per year on that property. Now imagine having 10 of these properties in your portfolio.
If you are going FHA, there are properties priced under $700k in my market that will cash flow $15k-$25k per year in year two after you move out. After 5-10 years when the mortgage is paid down by your tenants, you will be making even more money on a monthly basis from the rents AND have the equity built up in the property when you go to sell.