Yes a partnership tax return will probably run roughly $500; however, it ensures everyone is claiming the correct amount and not drawing the others for audit.

Remember that disclosure laws vary greatly by state, with roughly 50% of states operating under Caveat Emptor...which means no disclosure at all.

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

Payment to the bank is $4,311 (includes escrow/insurance), total monthly rent $5,600, which leaves me roughly $1,300 monthly after expenses.

That comes to roughly $616 a year in interest to borrow that money from the house.

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+ (roughly 5% probability of default), zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680 (around 10% probability of default), some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

For instance, for a $100,000 property, you’ll want to have $20,000 for the down payment, roughly $5,000 for closing costs, and maybe another $5,000 to $10,000 in reserves.

It would be pretty hard to buy $500+ per month cash flow unless you were buying in some rough neighborhoods. 

Because of this, he’s able to convert roughly $60k per year of his money in his old 401k’s and trad IRA to his Roth and he pays $0 in long term capital gains taxes.

Think of it as the rough sketch that helps you figure out where you want to swim: Omaha’s stable single-family rentals with decent cash flow and strong appreciation potential, the sizzling up-and-coming pockets around San Antonio where off-market deals still lurk if you’re willing to roll up your sleeves, or those tight-knit Chicago neighborhoods where a trusted investor-friendly agent can point you to contractors who won’t ghost you mid-reno.