Real Estate/Rental Property ?'s

[Ichiban]

If anybody has experience buying houses and renting them out, I would love some advice. If you are looking to cash flow a house, what is a good amount to shoot for? How much do you generally have to put back into the house on an annual basis? Is there a good timeframe to keep the house before dumping it, or do you try to hold onto it for the life of the mortgage?

Just recently bought a house, looks like I will be about +400/month, based on total payment and what renters are paying. This does not take into account maintenance, idle periods b/w tenants, and so forth.

Thanks in advance for any info.

 

[clarkd32]

as a rough guideline i usually take gross income (rents) - expenses (i usually use 30-35% of gross rents as an estimate) to get NOI. that is what i expect to have left to service the debt on the house (payments, insurance, taxes). but i also build it into the contracts that the tenant pay for anything up to $100 just so they don't bother me with every minor detail. sometimes unexpected events come up... in one of our houses we have had very bad flooding and the sump pump quit. had 18 inches of water in the basement since both tenants were working during the day. water was up in the furnace and it had to be replaced. bummer.

if you are saying you have $400 left after the debt service each month that should be pretty good imo.

other thing to look at is how your rent compares to other properties in the area. can you raise rents to increase income? just something else to consider.

good luck. keep us updated on how it goes.

 

[Fischer]

keep the houses til retirement...over time there is no better way to have your money tied up.

 

[jacobtree]

Rule of thumb is to have the rent 10times what you bought a house for so a house you pay 100k for should rent for 1,000 a month.

 

[aceduecetrey]

Rule of thumb is to have the rent 10times what you bought a house for so a house you pay 100k for should rent for 1,000 a month.

That is concievable once again, thanks to the crash. I know people that have Condos right now that they bought for 750k 2 years ago and can not rent them out for much more than 1500.

 

[Fischer]

Even though you may desperately want/need to, you cant discriminate.

 

[jacobtree]

That is concievable once again, thanks to the crash. I know people that have Condos right now that they bought for 750k 2 years ago and can not rent them out for much more than 1500.

When you are are dealing with 750k condos you are in a howl different ball park, and need to advertise different. I would assume your people bought that house for the long term investment, knowing they would take a big loss each month.

 

[sawastea]

Rule of thumb is to have the rent 10times what you bought a house for so a house you pay 100k for should rent for 1,000 a month.

10 x 1,000 = 10,000

 

[jocelyn]

Gathering individual data and verification of pay is a tedious piece of it, however, at that point, you additionally need to pick your personal references for apartment. Rental references, or references, are demonstrations of approval from individuals who know you in an individual, monetary, instructive, proficient, or earlier rental experience setting.