Dec 2023Build 1  PITI $2990   Rents $4100.  

For example if the rent is $1,000.00 per month they applicant must provide proof of income of at least $2,000.00 per month. 

With 3 bed renting for 1800-2000/month and 2 beds renting for 1400-1600/month this is going to be a cashflow monster bringing in over 5000/month!

People need to eat and pay rent.

The barrier is the additional complexity - now you are operating two sets of books, and filing two tax returns, and have more operating agreements, more state registrations, etc, need to manage cash better, need to keep in constant mind that your rents need to be a supportable FMV, which may require getting third party certification on your rents so that in the event of an IRS audit, what you have done is supported.In short...the size of the project, and the taxable income, need to be of enough scope to make all the additional costs and annoyances worth it. 

Over a portfolio of homes, over a period of time, the expenses not including financing cost, will be about 50% of rents. 

Are most renters snowbirds renting for 6-8 months?

Will an increase in market activity lead to more investing opportunities? 

But that’s because I complete some type of rehab and increase the value of the property and recycle my cash.

: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+, 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, 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.