That wont provide maximum returns, but as we pay off one loan ever couple years our cash flow and income from rentals increases greatly.

. … and your not doing tax returns for them or other accounting and such and your not on their loans with them etc.but I can see how @Andrey Y. 

@Ricardo Kendrick, is it now dawning on you that getting a (theoretical) gross return of 1.6%/m by buying any random property in that area might not be as fabulous an idea as you first thought?

If anything I would live in one room and rent out the other two individually at around $500.Property Type : Single Family 3 bed 2 Bath.Property Price: $200,000Down Payment of 5% at $10,000Loan of $190,000 at 5% interest rate                         ExpensesTaxes $150ExpensesInsurance $ 115Electric $ 100Water $ 70Gas $ 50HOA $ 0Lawn $ 25Vacancy $ 100Repairs $ 50Capx $ 100Mortgage $ 1284.96Total Monthly Expenses $2,044.96                "Cash Flow" (Didn't know what to title this section)Out of pocket $744.96Tenants Rent : $1300       Cash on Cash Return (This is the main part I need help with)Down Payment $10,000Closing Cost $3,000Rehab Budget $7,000Total Investment : $20,000

Or sell the pretty pictures in the brochures -- not sure how he's doing it, but he's showing those new houses on his FB page on a pretty regular basis.I was also surprised to learn from some BP friends over in Beaumont that they are getting higher returns on their rentals than we are. 

They helped us purchase 4 rentals in DFW and 4 in Houston, they make it very easy to be very hands off and still get great returns. 

I understand that leverage means more risk but at the same time more return on investment.

I actually think certain types can be decent investments IF you do the homework and read the docs and know what you're buying into.I personally avoid high rises (too much cap ex and high maintenance costs mean poor return), poorly maintained buildings with lots of deferred maintenance, avoid non-warrantable buildings or complexes (hard to finance), I prefer townhouses or 4plex style condos with only one common wall and nobody above or below, that limits neighbor and tenant drama. 

I dont think you provided total cost, but if we assume $200k, then the ROI would be:$19,200 / $200,000 = 9.6%Personally, I think cash-on-cash is good to judge making personal investment decisions as it provides you your REAL out-of-pocket returns. 

If cash has a opportunity investment value of 10% and you have a fully paid for 200K property the first $1666 of your rental income goes directly toward a return on your equity.