All Forum Posts by: Robert Johnson

Hey everyone, I'm Robert and I'm new here (and to real estate investing in general). 

I'm interested in real estate from the perspective of generating cash flow for my lifestyle. I live in Austin, TX and everything is really expensive here so I'm assuming I'll need to be location-agnostic in where I look for property. I'm currently in the stage of trying to determine what net cash flow I can generate based on the cash I put down. 

I see the 1% rule but I'm not sure that means if I paid $200k in cash for a property it would generate $2000 / month in net cash for me right? There's insurance, set-asides for vacancies and cap ex, etc that need to be considered. And maybe there are ways better than outlaying that amount of cash? 

I do see my initial goal as "How do I generate $2500 / mo in net cash flow" though so if anyone has any advice on where I should look to determine how to do this I'm all ears!

Happy to be here!

Quote from @Scott E.:

There are properties that meet this criteria. You'll need to look into markets like St Louis, Columbus, Detroit, etc/

Pros and cons to investing in markets like this. Make sure to do a lot of due diligence. 

Some people like to call this the "1% rule" meaning that the property generates about 1% of the purchase price per month in gross rents.

Thanks Scott! The 1% rule is saying that it generates that in gross rents, that's without paying insurance, set-asides for cap ex, vacancies, etc right? Is there a general rule of thumb of how much net cash flow a property might generate based on the value? 0.5%?

Quote from @Travis Biziorek:

As @James Wise noted, yes this is absolutely doable in the Midwest.

James focuses on Cleveland and can give you the low-down on that market. I am focused on Detroit and can tell you everything you'd want to know about the market there.

Our bread and butter are SFH's that we buy off-market for $50k-$60k, put $20k-$30k into a rehab and then rent for $1,100-$1,400/mo depending on bedroom count and location.

Folks will scream there's no appreciation to be had in the Midwest but that has not been my experience and I believe there are a ton of tailwinds that will continue pushing prices higher in the area.

I personally invest in Detroit from California and will continue doing so until the numbers no longer make sense.

 Travis this is incredibly helpful! Thank you so much! It seems from what everyone is saying that this is absolutely possible. Any advice on resources of where I can dive in and start learning about investing remotely? 

Hey everyone, I'm brand new to real estate and have a fairly simple question: I heard from someone that it might be possible to purchase a single-family unit for $100k in cash (even if it's $80k + $20k in renovations) and rent it out for $1200 / mo. This sounds outrageous to me and too good to be true so I wanted to check in here. I'm geographic agnostic although I'd like to stay in the lower 48 states if at all possible. Is this actually possible?