Confused on how to reach my goals

[Yael Fuerst]

Hi,

Although I am not new to real estate investing, I do find I'm at a loss of where to go from here to reach my financial goals.

I own two SFH, one in PA and one in AL which are mortgage free and yield around $1800 CF a month. According to zillow, they are value at $220K and $100K.

I am confused on where to go from here, I'm feeling that multi families are the way to go, I would love to reach $15-20K a month CF somehow, would appreciate any strategy advice or direction on how to reach this with what I already have. 

Thanks!

[Greg Scott]

"Mortgage free" is the reason you are having trouble getting there.

Based on your numbers, you are getting a 6.75% return on your equity.   I regularly see 20%+ returns in single family space. If you could only improve your returns to 20%, that would boost your monthly cashflow to $5,300 per month.  To do that would require taking on a mortgage and buying more SF rent properties.

By having more houses, you also have more depreciation to shelter that income from taxes.  By having more houses, you also get a multiplier effect from appreciation.  By having more houses you get more loan paydown (paid down by the tenant).