Reply to If you have rental property, how much do you make every month?

Forum Index » Money and Finances

Reply to "If you have rental property, how much do you make every month?"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]We are in he negative every month wrt mortgage and fees. However we make up for it at tax time :)[/quote]

How? How can you write off the loss of you aren't in the real estate business and make more than $110,000 a year?[/quote]

I would assume s/he is depreciating the property.[/quote]

But even if you depreciate, you can't offset anything but rental income right? I don't own any rental property, but it doesn't seem worth the effort of dealing with tenants if you don't make any money. [/quote]

I don't own rental property but I would think the main draw is the tenant paying the mortgage and building up your equity for you.[/quote]

I disagree. There is an opportunity cost to tying up a down payment. If you have $150K you can put it in the market and make an average annual return of 7%. IMO rental property should return more than that to be worth the investment - not to mention the time and trouble.  
[/quote]

+1. I'd love to understand the economics of the PP with 24 units in Chicago. [/quote]

We are considering selling. The units are older now and no longer in a super desirable area, but do well because of college students and a steady stream. The property itself is worth several million, but probably less than you think (you'll find 10 and 12 bedrooms in Chicago for under $3M.... It's not DC). Everything pivots on what you think the rate of return we can achieve is - realistically we'd need to net at least $6M+ to have a comparable income stream. That's probably in the ballpark for our property (I should have typed 24 bedrooms, technically not 24 units).

The other consideration is that when the economy weakens we tend to do better with rentals, somewhat paradoxically perhaps because our location isn't great so we tend to see people who are cost conscious over most other things. So we've struggled with the decision to keep or not because the investment is basically a hedge at the moment, and of course it's very hard to time an exit from the market. And then purely emotionally, this property has been in the family a long time, selling it feels a bit like selling what could be a generational income stream (at least until the property gets so old it needs to be torn down, but that's a long ways away)[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics