Depreciation will continue to provide tax savings for years to come, of course.Appreciation isn't cash earnings, of course, until the property is sold, but it does factor into the overall wealth building opportunity in real estate investing.

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.While the rental property generates positive monthly income, the interest cost of borrowing the initial $100,000 results in an overall annual loss.

Hopefully you have that HELOC money earning interest for you in the mean time.

It also matters, depending on the locality, if you live and/or work there and what type of income you are earning.

You will need an Accountant to help figure out the EBITDA or Seller's Discretionary Earnings(SDE) for you and compare to the Tax Return to make sure it all looks good and makes sense.

What kind of hold period do you need to achieve the 16% IRR  while you are earning the 7% monthly rate?  

Hey Kylie,Your question hits home for a lot of us trying to make the most of our hard-earned money.

Make it easy for them to provide their details.Anything less will waste the hard-earned money you’ve spent—even if you’ve selected the best keywords, written the perfect ad copy, and utilized every cost-efficient Google feature.In the world of Google traffic, a first impression can often be the last impression.And I’d like to ask you:Have you seen pages like this from your competitors before?

The hourly wage Id earn on that after paying expenses and taxes would put me at half the median income for my metro area.

Then when you get ready to retire, if rates have come back down and you want to "earn" more cash flow by getting rid of your debt, have at it.