Trying to understand if investing in rental property is a good idea under the current high interest rate regime. I looked at several markets across the US and it’s very unlikely to find a cash flow positive property. For instance, one of the ‘cheaply’ priced properties I am looking at has a monthly expense of 4200 (including mortgage after 20% down, HOA, taxes and maintenance). The going rent for this property would be around 2800. That means a negative cash flow of 1400 per month. Is there any scenario where such an investment makes sense? All the advice seems to be that you should always look for positive cash flow in an investment property. One argument I have been thinking about is that if you can afford the negative cash flow (through other income), you are still building equity in the property while only paying for a third of it. Is this logic flawed?
Submitted August 28, 2023 at 02:53AM by getyoutogabba https://ift.tt/fqFBAIz
