Discrepancy - what am I missing?

[Mary Jay]

Hi guys,

So I have this acquaintance who owns 40 properties (SFH) in Illinoi and may be 3-4 in Florida. None of the properties are paid off, each property cash flows about $500 per month so he was able to quit his job and do real estate full time. What I don't get is, lets say he gets around 18-20K in cashflow per month... I asked him and he said his tenant turn over is around 1-2 years per property (So in every property a tenant moves out once a year or may be once per 2 years). Ok, mine as well...

Then, he says that to paint a house is about $250 (his handyman charges $25 per hour, so for 1300 sq feet house may be the handyman needs 10hrs, so= $250)

I just got 2 bids to paint a 2500 sq feet house and 2 different bids are for $7000 and $7500 in Florida.  

How is it possible that this guys is getting $250 bids and I am getting $7k bids? 

How is it possible that the cashflow is not eaten by the tenants turn over/fixes...

Just makes no sense to me....

[Terrell Garren]

I've used the same painters for maybe 10 years in NC. Generally, a 3BR/2BA 1,300 sq ft will cost $4-5K in labor and take a full week for two painters.  I do not like turnover and keep my rates a couple hundred dollars less than market to retain good tenants.  I guessing my average is 5+ years per property.  A 1-2 year turnover average would crush my business model.