Help with calculations

[Geoffrey K.]

I'm a numbers guy. In my research, I am at a point where I am ready to see "how" the numbers work. I'm interested in SFH rentals and would like to see if I understand methodology of working the numbers... (I'm going to try and keep this as basic as possible)

Suppose you have a property and you have put 20% down. Your mortgage loan would be valued at the price the property is sold minus the down payment. In the beginning, your equity is the down payment, correct?

After that, your monthly expenses (let's assume there is no CapEx, for the sake of understanding the intial process) would be the mortgage + escrow (including closing cost), HOA, taxes, insurance, property management (if applicable), and investor loan repayment.

Take these monthly expenses and subtract them from a rental payment and you have your general cash flow.

In addition to the cash flow, your equity would grow from the initial down payment via the loan's amortization.

After "X" number of years, you could potentially refinance the property to pull your equity back out for other investments.

Is this correct, generally speaking?