Rent out primary and move into free apartment

[Bill Ward]

I'm just writing this because I'm getting excited it may be about to happen. I'm not sure how calculations would work on this: essentially I may be getting a free apartment through my job. I just pay utilities.

My current house is in a great neighborhood, just a flood zone. PITI is about $1200 per month. Met with a property manager today, I manage my only other single rental myself, figured I give her a try. She's going to get together some suggestions on what to upgrade to maximize rent. Expected rent to be $1900-2100 a month. PM takes 10%.

So to me that's $1700 - maintenance, a month more than I have now. Not sure how that calculates as a normal rental where you could just subtract rent from expenses and set aside some for maintenance, because the act of renting it out allows me the zero rent at the apartment. So it doesn't need to be cash flowing on paper to be net cash flowing for my wallet. Worth a try anyways. I'm single right now so I don't need the extra bedrooms (4) and big yard. Figure I could do some downsizing for a year or 3 and save up some good money.

Thanks for listening.

[Nathan Gesner]

Quote from @Bill Ward:

Go run it through the BiggerPockets calculator. It sounds like a winner, but it's nice to confirm and see what your profits will be.

If you're wise, you'll take every penny it earns and create a reserve fund to handle vacancies, maintenance, capital expenditures, etc. Once you have a sufficient reserve (6 months of rent would be my estimate), then you can continue saving up the income to prepare for your next investment. Don't spend a dime of it. Save up and keep investing. You'll be amazed at how quickly it can grow.