Basics of Real Estate Syndication
What is Cash Flow in real estate?
Let’s take an example of a Single Family Rental (SFR) with one unit.
Here we have tenant family who are paying their rent every month on time.
They don’t bother us unless absolutely necessary.
They take great care of the yard and follow all the HOA rules and regulations.
They comply with adverse weather advisories to keep our property safe and secure.
You know, the Perfect Tenant!!
Income= Monthly Rent X 12
Expenses= Mortgage (Principal+Interest+Taxes+Insurance)
Routine Maintenance
Property Management (8-10% of the Monthly Rent)
Incidental Expenses (e.g. AC went out)
As we know Cash Flow= Income – Expenses (Duh!!!)
This is where it can get tricky
Some “Investors” will actually get a property where the expenses are higher than the Income and create a consistent Negative Cash Flow for themselves. There are multiple factors that can make the Investor overlook this fact. Couple of months of Negative Cash can be “tolerated” but consistent Negative can completely ruin your financial goals.
We want a property that will “Consistently Add Cash” to your account!!
Other Blogs
What is Cash Flow in real estate?
Let’s take an example of a Single Family Rental (SFR) with one unit.
Here we have tenant family who are paying their rent every month on time.
They don’t bother us unless absolutely necessary.
They take great care of the yard and follow all the HOA rules and regulations.
They comply with adverse weather advisories to keep our property safe and secure.
You know, the Perfect Tenant!!
Income= Monthly Rent X 12
Expenses= Mortgage (Principal+Interest+Taxes+Insurance)
Routine Maintenance
Property Management (8-10% of the Monthly Rent)
Incidental Expenses (e.g. AC went out)
As we know Cash Flow= Income – Expenses (Duh!!!)
This is where it can get tricky
Some “Investors” will actually get a property where the expenses are higher than the Income and create a consistent Negative Cash Flow for themselves. There are multiple factors that can make the Investor overlook this fact. Couple of months of Negative Cash can be “tolerated” but consistent Negative can completely ruin your financial goals.
We want a property that will “Consistently Add Cash” to your account!!
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