How are you making any money with Rentals?
How are you making any money with Rentals?
OK... I know. Pretty general question. But truly... how are you doing it to your satisfaction. Now here is the reason for the question, and of course I would like to hear input. I am brand new to this forum, so I suppose I would like to get a feel for how everyone 'thinks' or processes their real estate investment.
OK.. I purchased a home for 40K that will rent for $650. After all expenses, debt service, vacancy and maintenence, the cash flow will only be $145/mo.
So I will be receiving $650/mo but only keeping $145/mo until the first small crisis that will cost 2K (roof/ furnace/ toilet, etc...) AT which time will not make any of this worth my time. NOTE: I will be doing all of the property management, etc... sleepless nights, etc...
So..... why do you do it? Honest question. And honestly, I appreciate all responses.
Most Popular Reply
@Anthony Newbold How much do you have into the property? If you put down 20%, then your cash on cash return is like 20% with that $145 a month. If you put down 25% your cash on cash is 17%. Ive got to say those are phenomenal returns. Yeah $145 a month may not be a large amount of money, but you did not invest a lot of money.
(I was not factoring in closing costs just to make the math easy)
What is investing? It is deploying capital to get a return on that capital. If I am deploying my capital to get a 20% cash on cash return, I would do that every day.
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