Quote:
Originally Posted by sherm
Initially we hadn't planned on getting in on Real Estate as an investment. The home going up for rent was supposed to be our primary home...until we found one more suited to our tastes that was a VERY limited opportunity.
This rental will be a break even, as it was financed more as a primary home with a 10 year mortgage. I'm not too worried about the equity on it in the near future. We owe pretty little and we're not borrowing on it's equity to fund the new primary residence. In 7 years, the passive income will be near $2k a month after property management fees. It'll be nice to have that full loaf for sure.
Down the road, 100% of the decisions (of rental properties) will be based on ROI. With our primary residence, us liking it regardless of the market value is the key. We can hope the value goes up on that, but I personally don't see much upward trend over the next 5 years that is above inflation.  |
If it's break even due to the loan that's some forced savings which I guess is a thing, but why not sell and buy a few leveraged properties with better numbers? Maybe not immediately but as you get more comfortable doing it and need more for down payments. Another option is cash out refi, pull extra equity out (tax free), change term to longer for cash flow so you can reinvest quicker