All Forum Posts by: Marcus Johnson

Ned Carey I am talking about net cash flow income. Isn't that the only type of cash flow that matters? If you own rentals there are expenses and such as taxes, insurance and upkeep. So even if your mortgages are free and clear, if you don't have tenants then your cash flow is negative. Am I right?

Ned Carey I'm not making any assumptions at all. You stated that your net worth would increase greatly with the cash flow from rentals and are paying the mortgages and expenses. But the truth is that if the reverse should happen and you have negative cash flow due to some unpredictable event, then your net worth will decrease.

Ned Carey yes, but your assuming that your rentals are 100% occupied and that affects cash flow. Your also assumin then that your expenses aren't eating away at your cash flow. Since you have mortgages and debt then one can only predict that one may have trouble with their bills. There is no gaurentee of cash flow, only approximations.

@Account Closed

So no investments such as 401k, pensions or mutual or index funds?  Just wondering, because what happens if you have high vacancy rates due to the market, where the cash flow is heavily dwindled.

What other assets do you currently have?

For my duplex in south minneapolis I pay $116 for septic, garbage and water. The renters pay electric, gas and cable. Insurance is $135 and taxes are $225 a month. This is for a home that is now worth 190k and is in a nice neighborhood.

It makes good business sense to keep your personal money and business income seperate. I only use my LLC checking account of business purposes. Every night I track my expenses, mileage and income in an Excel spreadsheet. If I pay myself an income from my business checking I track that also. Since I don't pay myself anything from the business checking, when I get my rental income each month I pay the mortgage, the taxes, the insurance and the water and septic. That usually leaves me with aound $500 cash flow a month where $250 extra goes towards principle and $250 goes into the rentals business account to use for expenses. I plan to build that up to 10k.

Congrats! Most people are in debt.

Nope this is very normal. I bought a duplex in May and they wante 25% down and w2's, proof of funds, all of my investments and the amount of the gift which cannot be used for the DP if it was within 60 days. My father in law gifts I for Christmas every year so I have to wait until at least February before I bought my current duplex. I'm glad the lendin laws are so strict, it keeps the people out of the game who don't have any money of their own.

Property managers will never give the same amount o attention to details as I do when I manage my own properties. My tenants know me and respect me because I am proactive with heir issues whereas a PM is reactive. I have saved tenants from bolting because I am so concerned with their needs. A PM could never compare to my attention to detail. So if you want to show your tenants that you aren't there for them, then hire a PM. No thanks.