This creates two loan payments ($100,000 of equity and $300,000 on the new mortgage).Key NumbersHome Equity Loan Interest Rate: 6%Mortgage Interest Rate: 7%Rental Income: $3,000 per monthExpenses (management, taxes, insurance, maintenance): $800 per monthIncome and ExpensesMonthly Rental Income: $3,000Monthly Expenses: $800Monthly Mortgage Payment: $2,000ExplanationThe investor earns $3,000 in rent each month.They pay $2,000 on the investment property mortgage and $800 on other expenses.This leaves $200 profit each month or $2,400 per year.However, you have to pay $6,000 interest on the equity borrowed.This leaves you with an annual loss of $3,600.This example shows that while the rental property generates positive monthly income, the interest cost of borrowing the initial $100,000 results in an overall annual loss.

Investors buy, rent, and sell real estate to make a profit. 

We want to get into MF (2-3units to start) doing BRRR... and rent out for Mid term rentals.We see a house that meets our buy box, and our investment goals are;- $300 gross profit cash flow per month- 30% equity + with forced appreciation after rehab- Refi (if rates come lower!)

Usually those who caution offer cautionary tales because they learned first hand the difficulties in growing a scalable and PROFITABLE portfolio this way.

Here are a bunch that will help your research.https://www.biggerpockets.com/users/ZacharyCole/referenceshttps://www.biggerpockets.com/forums/92/topics/765347-rent-to-retirement-reviewhttps://www.biggerpockets.com/forums/92/topics/1116050-a-huge-win-with-cori-from-rent-to-retirementhttps://www.biggerpockets.com/forums/850/topics/895660-my-first-investment-property-an-out-of-state-dealhttps://www.biggerpockets.com/forums/88/topics/1047543-big-profits-from-new-construction-sfr-build-in-cape-coral-flhttps://www.biggerpockets.com/forums/92/topics/983659-first-investment-property-with-rent-to-retirement?

If you put that in terms of percentages for a moment - that is $120/$300 = 40% of your net profit going to the property manager.Often property management charges the first month's rent as a fee to place a tenant.  

You made a profit, which is awesome. 

The deal offered minimal risk with a good opportunity for profit, aligning with our strategy of fast turnarounds in high-demand markets.

I am on the board of an organization that has advocated legislation on behalf of landlords for now 50 years in Wisconsin (RPAWI .org) and have some insights into landlord-tenant laws.

property tax 11000 home insurance 5000 monthly bills 4800 yearly cost 20800 rent 3500 mgmt fee (20%) 700 net rent 2800 yearly net rent 33600 profit 12800 property value 700000 % profit 0.018285714