We Earned $231/hr From Our Rental Properties in 2018

The 2018 #s are in! The biggest # we track when it comes down to it is cash flow. While cash-on-cash return comes in at a close second for priority, the main focus for us is cash flow. And while I don't go into net worth accumulation by someone else paying down your debt (i.e. … Continue reading We Earned $231/hr From Our Rental Properties in 2018

Real Estate Investing Terms: DTI

First off, what is Debt-to-Income? The Debt-to-Income ratio is one used by lending institutions when underwriting your loan (for almost anything - car loan, mortgage, HELOC, etc). DTI is a calculation they use to  measure the risk on which you'll be able to pay back the loan you're seeking. The lower your DTI, the less … Continue reading Real Estate Investing Terms: DTI

Real Estate Investing Terms: Net Operating Income

OK, ok, full disclosure, this one is really for me. When recently analyzing a real estate investment opportunity, I added an expense that is not considered an operating expense and it totally through off my evaluation of the #s and almost resulted in a very offensive offer. Sometimes offensive offers are required, but always take … Continue reading Real Estate Investing Terms: Net Operating Income

Real Estate Investing Terms: Cash On Cash Return

When performing the Cash-on-Cash Return napkin test, I won't further analyze anything that is below 12%. The target is 15% and higher but if we can still hit our $100/month cash-flow minimum, we'll consider it with a lower CoCR.   Cash-on-Cash Return or CoCR CoCR = annual cash flow before taxes divided by total cash … Continue reading Real Estate Investing Terms: Cash On Cash Return

Real Estate Investing Terms: Cash Flow [example]

Because we focus on buy & hold rental properties in Pensacola, Cash Flow is the most important metric we look at when considering an acquisition. _____________________________________________________________ Caution: This post goes technical real quick and my geeky side does come out 🙂 Most people, even some experienced Realtors, think cash flow is the gross revenue generated … Continue reading Real Estate Investing Terms: Cash Flow [example]

Real Estate Investing Terms: Capitalization Rate

Cap Rate...it's not science rockets!? Wait, did I say that wrong? _____________________________________________________ Capitalization Rate (Cap Rate for short) is the measurement used to reveal how well a real estate investment will perform or is performing. I look at 3-5 investments in Pensacola a day and Cap Rate is one of the factors I consider when … Continue reading Real Estate Investing Terms: Capitalization Rate