▲ 2 r/RealEstateROI
The rental looked like +$310/month until I put vacancy and repairs in as real numbers
Ran numbers on a single-family rental this week and almost fooled myself.
Rent: $2,100/month
Mortgage (P&I): $1,280 Property tax: $280 Insurance: $120 Water/sewer (owner pays here): $110
Total: $1,790. That leaves $310/month. Looked fine.
Then I added the stuff I usually leave as "I'll deal with it":
Vacancy at 5% of rent: $105 Repairs/maintenance at 5%: $105 CapEx reserve (roof, furnace, water heater spread out): $150
That's another $360/month.
$310 − $360 = −$50/month.
Same house, same rent. It just went from "cash flowing" to slightly negative once the boring lines got real numbers instead of zero.
Might still be worth holding for paydown and appreciation, but it isn't a cash flow deal, and I'd rather know that before buying than after.
u/ppaloes — 11 days ago