I tell everyone starting out, this. You need to know EXACTLY what it will rent for, what your monthly expenses are and how much your rehab will be (if needed).

You can't afford to mess up on these.

The bare minimum should be 1% of your purchase price should be the rental price. My personal goal is 2% but that has become very hard in this market.

In my opinion, your first is your most important as that is the one you learn on.

The creative financing goes deep but these are good rules for someone starting.

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Posted by tigerfoot

Alexandria

Member since Sep 2006

56711 posts

Posted on 6/16/22 at 10:16 am to I Love Bama

quote:
The bare minimum should be 1% of your purchase price should be the rental price.

Do you factor in rehab costs here? I assume yes, as that number can vary greatly.

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Posted by MrJimBeam

Member since Apr 2009

12457 posts

Posted on 6/16/22 at 10:19 am to I Love Bama

quote:
I tell everyone starting out, this. You need to know EXACTLY what it will rent for, what your monthly expenses are and how much your rehab will be (if needed).

You can't afford to mess up on these.

The bare minimum should be 1% of your purchase price should be the rental price. My personal goal is 2% but that has become very hard in this market.

In my opinion, your first is your most important as that is the one you learn on.

The creative financing goes deep but these are good rules for someone starting.

Agree with all of this. There are a few things you need to consider in the big picture. Are you able to manage? If so, this helps with cash flow tremendously but it's not for everyone. A good Property Management company can go a long way for those that aren't able to invest time into it but it cuts A LOT into your return. Depending on the type of property and how old/new it is, you need to keep in mind big ticket items breaking and having enough cash to cover.

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