Cash Flow (Newbie)

What is the least amount of cash flow you would take when buying/holding a property?

That varies greatly. It is better to think in percentages better than dollars - aka how fast do you get your money back. E.G. My minimum APY for an all-cash investment on a standard single family home is 20%. I can get upwards of 50% though on certain deals, though they are rare.

If you bought a used mobile home or camper for $2000, and sold it on a note (so no maintenance, etc was required on your part) for $250 a month … well that’s not much cashflow in terms of dollars, but you are getting a great return in terms of a percentage.

If you paid $100,000 for a house and rented it for $2000 a month … that is a lot more cashflow in terms of dollars than the mobile home deal, but most importantly you are still getting a great return in terms of a percentage.

If you bought a $10,000,000 office building, and put $1,000,000 down on it (financing the remaining $9mm) and earned $500,000 in net profit on the building per year … you’re still getting a cash on cash return of 50% which is awesome. Those are huge dollars, but again more importantly, the percentages are good.

How much money you have saved up, cash you earn each month and experience in investing helps determine how big of a deal you can do. It’s best to start small & work your way up.

Hopefully that helps.

Not disagreeing, just want to expand on something.
Make sure you include all expenses including your labor and property management expences, even if you are self-managing.
Including your labor it terms of dollars allows you to use strict percentages like previously mentioned.

Great post CEO. I often find myself getting caught up in dollars as opposed to percentages. Thanks NREI for posting the question. LOL. :beer