The location determines all long-term income characteristics, including whether rents will keep pace with inflation and how long the income will last.There is a straightforward process, comparable to peeling an onion, as illustrated below.

While there might be some fluctuations in market value in the short term, the consistent rental income and potential for future appreciation can make these investments quite valuable in the long haul.Hope this example helps illustrate the point a bit better!

The process is illustrated below.With interest rates over 7%, this no longer works.

Let me share the actual numbers to illustrate the situation better.Initial investment in 2020 = $50,000Cashflow + sale proceeds in 2022 = $40,465 ($90,465 including returned capital)Following were the reported losses/gains on Form 8582 (captured from my CPA’s worksheets).

If they will do a loan with less than 1, the pricing takes a hit.I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23DSCR lenders generally let you vest either individually or as an LLC.

I'll post the current 30-Year Fixed Rate National Average according to publication Mortgage News Daily and I'll also include the chart of the 10-Year Treasury over the past 2 years to illustrate why mortgage rates are climbing so much.

It was also at the top of the market in January 2022, which just illustrates that there are always good deals but they need to be analyzed properly. 

From time-to-time, I do give group presentations as an intro into the business, with that intent to illustrate the advantages of being a passive investor.

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23DSCR lenders generally let you vest either individually or as an LLC.

I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23DSCR lenders generally let you vest either individually or as an LLC.