House Hack Realization...

[Brian Mackey]

Hey so I was thinking about something the other day.  I currently House Hack, using AirBNB (Yes Covid has disrupted it a bit), but Pre-Covid I was covering the mortgage +1000's.  This equates to $2400 a month on average.

I got to thinking, I'm taking in $2400 a month and using it to pay for my mortgage and lifestyle, it's as if I have 12 doors at 200's a piece.  If that is the case is it actually even necessary for me to pursue purchasing more real estate?  I mean I'm looking all the time at potential deals, that will obviously add to my net worth if purchased properly.  But if they only produce 1-200 a door, is it worth all the effort when I've virtually got 12 doors in the form of the house hack?

I hope that makes sense.
  

[Gregory Schwartz]

@Brian Mackey some very good points have been made. I'd like to add to the equation by factoring in equity growth. On a 30 yr mortgage you pay down roughly 2-3% over the first few years plus, the icing on the cake, appreciation is on average 3-4%. Quick math

Lets look at a 200k home on a 30 year mortgage. Principal paydown of $2,500 and appreciation growth of $6,000 for a grand total of $8,500. So yes those additional properties might only cashflow $2,400 over the year but your net worth is going to grow by close to $11,000! 

Cash flow is nice but equity growth is where you truly build wealth.