Rent Cash Flow |
Here are the factors used to calculate rent cash flow. |
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Rental Income |
I have 20 years of property mangement experience and "move" about 2 properties a week. Properties that have not been surveyed are probably off by about $100 as the condition of the property can't be done by desktop. |
Mortgage Cost |
There are so many factors that are involved here that I use a rule of thumb of $800 per $100k of home. My investors are usually happy that I inflated this value a little bit. |
HOA Fees |
This is the dollar amount listed publicly. It's rarely innacurate. |
Taxes |
This is the dollar amount listed publicly. It's rarely innacurate. |
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Here are factors not used in estimating cash flow. |
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Management Expenses |
I deliberately left this out because some folks like to manage their own stuff. Generally speaking companies charge about 8% of gross income + 10% of managing repairs. I charge 10% income + 10% of managing repairs because I can and just don't care if you use someone else. |
Vacancy |
Some investors make a mistake of holding out for high rents. My philosophy is get someone in there tomorrow who is qualified. I will give you my recommendations but its up to you to decide what a property is posted at. |
Repairs & Maintenance |
There is no way to effectively estimate this until a property is formally inspected by a licensed inspector. |
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Lease/Option Cash Flow |
First of all you need to understand that lease/options may not be your cup of tea. You have to have guts and know that you could potentially lose money in a lease/option. If you really want to know more about lease/options, please go here: FAQs about lease/options. Investors who do not read that page often lose 2-8 mortgage payments! |
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Rental Income + Option Premiums |
All my properties are lease/optioned. Generally, I get a $300 to $800 premium over rent with a lease/option. I network with all the lease/option specialists in Las Vegas and we move 4-8 properties a week during the summer. |
Mortgage Cost |
There are so many factors that are involved here that I use a rule of thumb of $800 per $100k of home. |
HOA Fees |
This is the dollar amount listed publicly. It's rarely innacurate. |
Taxes |
This is the dollar amount listed publicly. It's rarely innacurate. |
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Here are factors not used in estimating cash flow. |
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Management Expenses |
In a lease/option, money goes directly to you or to an escrow account. There are no management expenses unless you really want me to charge you 10% to hold your money. Investors who use me to lease/option their property get free eviction services. |
Vacancy |
Some investors make a mistake of holding out for high rents. Be reasonable and you will make money faster. |
Repairs & Maintenance |
Buyer/tenants pay the first $500 in repairs. Generally speaking, this cost is nearly zero for new properties. |
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