YES!
2024 UPDATE: We already stated that owning a rental home is a great investment. A 20% return after taxes is possible with professional property management and all expenses covered.
But what if the numbers get really bad? Is it still a good investment?
YES 11% RETURN ON INVESTMENT with negative Cash Flow
(Price and rent appreciation, fixed payments, pay down principal) … + tax advantages
Hint: Call Real Property Management Rio Grande at 505-292-4765. https://www.rpmriogrande.com for the answer!
The Best in Albuquerque Property Management
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Hypothetical Math Example (all numbers for example only)
Let’s say you own a $300,000 home in Albuquerque with a $30,000 down payment
monthly payment on 30 year mortgage. This comes with a 6% mortgage rate, not being the best, with $1,950 a month.
There are $330 in taxes and insurance per month
Rent is $2,100, BUT we’ll add 5% vacancy to make it worse
Albuquerque Property Management Fees are 10% per month.
Property expenses like repairs and maintenance are $1,200 per year… but let’s add 50% increase to that and make it $2,000 per year.
Your cash flow is now – $325 per month… which might seem very tough to handle.
However, your return on investment (ROI) on the initial $30,000 downpayment over 20 years is greater than an 11% return, this is even with very bad example numbers, vacancy, overly high expenses, etc.
Not too bad!
For more details on returns: https://www.calculator.net/rental-property-calculator.html
Note: if you don’t use professional management like RPM, you wont get the rent, appreciation, or protection of your investment that you deserve!
Mark Webb
Real Property Management Rio Grande
505-292-4765
This content is provided for general informational and educational purposes only and does not constitute financial, legal, tax, or investment advice. Readers should consult with licensed professionals regarding their specific circumstances.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.
