Rental Property Analysis - Extremely High Cash on Cash Return

3 Replies

Good Evening,

I've been playing with some numbers in the Rental Property Calculator/Analysis and I feel like something is off. For a 4 unit small multi-family, for my monthly cash flow to be $100/unit, it is showing my cash on cash at 128%. Am I missing something here? I'm going to try to attach the pdf to the post. I'm using numbers as accurately as I can. The 0% down is normal, I'll be using the VA loan, and I don't mind paying myself $950 a month.

P.S. If it doesn't come through, I'll edit this post (or post underneath) with all the data.

Thank you

i haven't seen your pdf but If you have 0% down payment and very low closing costs, it is no surprise that your cash on cash return can be very high.
Taking ownership of the property costs you almost nothing out of pocket and you'll be cash flowing around $4800 a year (accounting for the fact that you are also paying a rent; which is good accounting in my opinion)
It might not be the best deal in absolute terms but relatively to your initial investment, it is a good one.

Thank you very much for your response.  I played around with a few more properties and got better numbers when I did not use the 0% down. I think I'm understanding how it is all working now.  Much appreciated!

Looks like you figured it out @Chase Stocki , but yes, you left off your down payment. :) Or perhaps you found a 0% down loan, which would explain it. The way the BP calc works is it takes the Monthly Cash Flow x 12 (to get your annual #) and divides it by the Total Cash Needed.

If you found a 0% down lender, PM the details!! :)

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