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Updated over 6 years ago,

Account Closed
  • Fort Worth, TX
10
Votes |
21
Posts

Infinite Return or Higher Cash Flow?

Account Closed
  • Fort Worth, TX
Posted

I'm currently still in the beginning phase of analyzing deals and I'm about to offer on a SFH for a rental unit. I've been playing with the calculators, and I'm trying to decide what makes the most sense...

Should I get more cash flow from day 1 but have a lower CoC return (~$200/month NOI with about 20k left in the deal)

OR

Should I BRRRR and try to get all my money back out of the deal so I can increase that CoC return, at the cost of the monthly cash flow (~$10/month NOI with zero left in the deal)?

I think I'd like to have all my money back so I can get into another property, while my tenants pay down principal... and I'm budgeting for capex, maint/repair, vacancy, insurance, taxes, and management... but is the benefit of having nothing in the deal worth having almost no true cash flow?

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