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Updated about 6 years ago on . Most recent reply

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Jason Malabute
  • Accountant
  • Los Angeles, CA
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improving ROI on cash purchases

Jason Malabute
  • Accountant
  • Los Angeles, CA
Posted

How do you improve (increase) your ROI on cash purchases for hold and rent deals ? How about for BRRR?

When I'm practicing analyzing deals I find that I CF but my return on cash is not impressive

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Ned Carey
Pro Member
  • Investor
  • Baltimore, MD
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Ned Carey
Pro Member
  • Investor
  • Baltimore, MD
ModeratorReplied

@Jason Malabute yes. By refinancing you will earn less total dollars on that property but your return  on the money you have invested will increase.  Just as important you now have dollars to invest in another property so you get additional return on that. 

Another factor is the incredible wealth building by appreciation when borrowing.  Lets say you buy 1 property for all cash and in 7 year it doubles in value. You have doubled your money. But what if you put 20% down on 5 houses. If each of those doubles in value you have increased your net worth 500%

  • Ned Carey
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