'Won't make any money until your mortage is paid off'
Met with a property manager today who told me, 'I won't make any money until my mortage was paid off.' Said he was just being real with me. He'a had dozens of rentals of his own and manages over 100 homes, and claims only now that he is making money since some of his mortgages are getting paid off in full.
He said he's a big believer in Dave Ramsey'a debt snowballing and wants to eliminate all of his debt.
It felt like after he realized he lost me with his pitch after saying all this he went on to say, it's not like they aren't making any money. Just 8-9% but that's nothing to some people, he said.
Isn't leveraging real-estate 101 or am I missing something here?
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If you are a successful buy and hold investor your property should cash flow. That is bringing in money after all expenses are paid for. You make sure your potential property will cash flow before you even purchase it with good due diligence. If it doesn't move on to the next deal.
He obviously wasn't a successful landlord.