BUY AND HOLD RETOTD Episode 00109

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BUY AND HOLD

The idea is to buy houses that can be rented for more than the PITI.  Ex/if the PITI is 1,200 per month, you want to be able to rent that property to a tenant for $1,400 or more per month. A good rule of thumb is that you should be able to rent a property for 1% of the purchase price. For example, if a house costs $100,000, you should be able to get $1,000 per month rent for it. Now you can’t retire on $200 a month cash flow. If you have 10 properties doing that, you’ve got a nice start. 20 properties starts getting almost livable.  In the meantime, you are paying down the note on the property and (hopefully) rents are rising, due to inflation if nothing else.  

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