My parents recently started buying rental property and they've never given me a satisfactory response as to why they don't just keep buying more. Maybe I'm missing something crucial, but here's me looking up the first property listed on Loopnet for my area. I read somewhere that you should budget 50% of the rent towards expenses, so I went with that.
Property Cost: $299,490
Down Payment: $74,872.50
Monthly Rent: 3,570 (6 units, $595 per)
Loan Amount: $224,617
Monthly Payment: 1,624.57 (15 year, 3.67%)
Estimated Expenses: $1,785 (would add 8% for management fee)
Take home per month: $160.43
Annual ROI: 2.57% in cash, 17.60% when you include the principle paid towards the property.
Obviously this increases very quickly when you reduce your expenses every month. Is there something huge that I'm missing here?
Submitted January 07, 2017 at 06:41PM by Aflycted http://ift.tt/2i1sR9f
