The investors are buying below the fair market value and the rents in the areas are like $1200 to $1500 and the Section 8 is paying $1250 for the homes the monthly payments are like $600 giving a $650 positive cash flow.
I’m just wondering what kind of net positive cash flow investors like to see on residential rental properties…specifically in the North Dallas, TX. area. I have a couple of houses that make positive cash flows of about $150-$200 a month. Does this sound low? Thanks…
I have a few rentals & I am not getting the positive cash flow other people are. I get between $100-150 positive cash flow on each unit, and have a few SFH and one duplex. My payoff on these is 10 years, & I am wondering if my cash flow is lower because I have a shorter payoff period, or should I be getting better deals?
I live in Collin County and I invest in the metroplex. Your numbers sound about right and if you have just acquired these properties, they sound like you’re doing a good job. Remember: Rents go up with time.
Types of properties give you different cashflows. And if you invest in the South Dallas area, that’s where the real cash cows are. But do you feel comfortable going there to collect rent or talk to your tenants if you need to be there? It’s all a matter of choice.
Thats a fair range. I do mostly single families now. On the financed ones the ranges are about 150-300. I also manage my own which puts more in my pocket.
Ted, I normally getting anywhere from $200 to $350 positive cash flow on my single family homes but you can increase by renting to section 8ers! I know of investors who are getting $650 positive cash flow per home from Section 8.
How did you get 10 year payoffs on investor loans? Most banks and mortgage companies I have talked to only offer 30 year loans on investor loans for rental houses.
I pretty much deal with one bank, & most of my loans are what they call “in-house”. I can choose my term length, but it can’t exceed 20 years. The interest rate is prime + 1%, & I pay 1/2 point origination fee. The only other closing costs are for the lawyer & an appraisal, plus title insurance. The drawback is that the rate is only set for 5 years, so if prime goes up my rate would go up. This hasn’t been a problem yet, because I have either sold or paid off any that might have been due for a rate increase.
I guess I am a little different than most of the people who post here, I’m pretty conservative in the amount of debt load I will take on. I know I am limiting my growth rate, but I sleep a lot better at night if I am not highly leveraged.