How Much Positive Cash Flow? - Posted by Ted

import · July 7, 2003, 3:44am

Posted by Clair-MO on July 08, 2003 at 18:53:48:

The investors are buying below the fair market value and the rents in the areas are like $1200 to $1500 and the Section 8 is paying $1250 for the homes the monthly payments are like $600 giving a $650 positive cash flow.

import · July 7, 2003, 3:44am

Posted by Ted on July 07, 2003 at 03:44:36:

I’m just wondering what kind of net positive cash flow investors like to see on residential rental properties…specifically in the North Dallas, TX. area. I have a couple of houses that make positive cash flows of about $150-$200 a month. Does this sound low? Thanks…

import · July 7, 2003, 5:06pm

How long a Mortgage? - Posted by Tim

Posted by Tim on July 07, 2003 at 17:06:35:

I have a few rentals & I am not getting the positive cash flow other people are. I get between $100-150 positive cash flow on each unit, and have a few SFH and one duplex. My payoff on these is 10 years, & I am wondering if my cash flow is lower because I have a shorter payoff period, or should I be getting better deals?

import · July 7, 2003, 12:41pm

Re: How Much Positive Cash Flow? - Posted by Dan-Fl

Posted by Dan-Fl on July 07, 2003 at 12:41:44:

I average $200-$300 a month, but I have one section 8 that pulls in $400 a month and one M.H. that pulls in $450 a month.

import · July 7, 2003, 10:19am

Re: How Much Positive Cash Flow? - Posted by Maxx(TX)

Posted by Maxx(TX) on July 07, 2003 at 10:19:03:

I live in Collin County and I invest in the metroplex. Your numbers sound about right and if you have just acquired these properties, they sound like you’re doing a good job. Remember: Rents go up with time.

Types of properties give you different cashflows. And if you invest in the South Dallas area, that’s where the real cash cows are. But do you feel comfortable going there to collect rent or talk to your tenants if you need to be there? It’s all a matter of choice.

import · July 7, 2003, 8:57am

Re: How Much Positive Cash Flow? - Posted by RichV(FL)

Posted by RichV(FL) on July 07, 2003 at 08:57:01:

Ted,

Thats a fair range. I do mostly single families now. On the financed ones the ranges are about 150-300. I also manage my own which puts more in my pocket.

Regards,

RichV(FL)

import · July 7, 2003, 8:22am

Re: How Much Positive Cash Flow? - Posted by Clair-MO

Posted by Clair-MO on July 07, 2003 at 08:22:26:

Ted, I normally getting anywhere from $200 to $350 positive cash flow on my single family homes but you can increase by renting to section 8ers! I know of investors who are getting $650 positive cash flow per home from Section 8.

import · July 9, 2003, 1:28am

Re: How long a Mortgage? - Posted by Ted

Posted by Ted on July 09, 2003 at 01:28:06:

How did you get 10 year payoffs on investor loans? Most banks and mortgage companies I have talked to only offer 30 year loans on investor loans for rental houses.

import · July 8, 2003, 6:09pm

Re: How Much Positive Cash Flow? - Posted by Sam

Posted by Sam on July 08, 2003 at 18:09:52:

How did they get $650 cash flow per home from Section 8? Did they buy low (low mortgage payments) and charge higher rents than market rents?

import · July 7, 2003, 7:59pm

please forgive my ignorance - Posted by rm

Posted by rm on July 07, 2003 at 19:59:33:

but, how does an investor go about getting section 8 tenants?

Are there any special requirements the property must meet?

import · July 7, 2003, 9:00am

Re: How Much Positive Cash Flow? - Posted by RichV(FL)

Posted by RichV(FL) on July 07, 2003 at 09:00:04:

Clair,

Thats a handsome cash flow. 650 a month on Sec 8, not bad at all.

RichV(FL)

import · July 9, 2003, 6:30am

Re: How long a Mortgage? - Posted by Tim

Posted by Tim on July 09, 2003 at 06:30:50:

I pretty much deal with one bank, & most of my loans are what they call “in-house”. I can choose my term length, but it can’t exceed 20 years. The interest rate is prime + 1%, & I pay 1/2 point origination fee. The only other closing costs are for the lawyer & an appraisal, plus title insurance. The drawback is that the rate is only set for 5 years, so if prime goes up my rate would go up. This hasn’t been a problem yet, because I have either sold or paid off any that might have been due for a rate increase.

I guess I am a little different than most of the people who post here, I’m pretty conservative in the amount of debt load I will take on. I know I am limiting my growth rate, but I sleep a lot better at night if I am not highly leveraged.