How Would You Run These Numbers?

[Marten M.]

I have what I imagine to be a pretty common scenario, but I'm having trouble wrapping my head around the proper way to run these numbers.

I just recently pulled equity out of my current house. I plan on using roughly $40,000 (20%) to renovate this house and the remaining $160,000 (80%) will be used to invest in other properties. The problem I'm having is when I run numbers on the current house I have, do I calculate the full amount of the P+I which is $910/mo. or do I only account for 20% of the P+I ($182/mo) as the remaining 80% will be invested in other properties?

If I calculate the full P+I, the house is negative cash flowing (which is somewhat okay because I currently live here, can raise rent for the second room and have a 3rd room that is empty I could rent out). If I calculate only 20% of the P+I, I pretty much break even - again, I still can increase cash flow by renting out the 3rd room so it's not the end of the world, but I'd like to know the proper way I should be doing this.

Hopefully this makes sense and I appreciate any insight you folks can give me.

Thanks!