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Updated about 11 years ago on . Most recent reply
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Is there a cash flow range you "aim" at?
Greetings!
I’m wondering if you evaluate a property’s usefulness on a sliding scale, or not.
Regarding monthly cash flow, I notice that the cash amount you will clear varies from property to property. (obviously, due to diff. variables)
But is there a certain range of cash which YOU aim to take out of a given property each month?
I realize everyone has different ideas about cash flow, and depending on one’s goals, cash flow may not be as important to some individuals as it is to others.
Okay, here’s a specific question: do you set your cash goal at a certain percentage of some number, or do you have a fixed cash number try to pull from each property monthly?
For example, let’s say you have two units, one rents for 500/mo and one rents for 1000/mo. (assuming the 1% rule) Let’s say that after expenses et al you see you can clear 200 cash on each property, monthly. By these calculations, wouldn’t it make more sense to buy four of the 50,000 units instead of buying four of the 100,000 units?
I mean, if the cash flow is identical, you could get into four 50,000 properties for 200,000 but it would take 400,000 to acquire four 100,000 properties, for the same cash flow.
Am I missing something here?
Thanks in advance!