Initial Investment vs. Cash Flow

[Kevin Rollins]

I'm looking at purchasing my first duplex for $120,000. I'm hearing in some markets getting $200 a unit is good cash flow. Is this still the case when the initial investment is $30,000? Does tying up $30,000+ to make $400/month reasonable? Thanks for any advice as I get started down this road.

[Joe Villeneuve]

That's over 6 years to break even...assuming all goes well (LOL).  I wouldn't do it, but the more pressing question isn't the one you posed.  The most pressing question is, "what are your future investment plans to invest after you buy this duplex".

The answer to my question is a huge contributing factor to the answer to your question.

Too many REI don't think beyond the immediate property. You don't buy properties...you "move cash..through" (not to, but through) every "deal" (not property, ...deal) you make, into the next deal. If you don't know where you're going AFTER you make the current deal you are making, how will you know if the deal you are making is a good deal at all?

I'm constantly seeing this same statement/question posed here, "I just closed on my <fill in the property # here>...now what do I do"?  Sorry, but if you didn't know the answer to the "...where am I going...", you probably went to the wrong place to begin with.