Re: BUILD DUPLEX / RENT UNITS - Posted by Steve (Austin, TX)
Posted by Steve (Austin, TX) on September 22, 2004 at 06:52:57:
My first RE project was building and then renting out 3 duplex’s. Construction went pretty smoothly, actually came in ahead of schedule and under budget by about 5%. However I misjudged the rent they would get by abut 15%, and to compound that because I was asking too much I had 6 units sit empty for 2 months, eventually tunred it over to a realtor, dropped the price, and they all leased in 2 weeks. This was two years ago, right now the cashflow is about break even (still in a slow market), but the depreciation realizes some significant tax savings for me.
And of course, you havenegative cashflow while you are dealing with the construction loans, taxes etc while building.