A. A. wrote:User wrote:
> Ive been investing in the stock market for many years
> and been happy with the returns. However, I was recentl
> approached with a more secure investment opportunit
> where I can buy a real estate to offer as rental property
> I never invested in real estate before, and I wil
> certainly do a lot of research if I decide to do it
> However, I would only like to know for now what kin
> of monthly return can be expected from it. For example
> for each $100k of a rental property value you invest
> whats the minimum rent you would accept, and the maximu
> reasonable rent that the tenant can be expected to pay
There is not a good linkage between amount down on
property and amount of rent charged
To find amount down, look at the current asking prices i
the area, figure in some amount to offer under that, an
the financing available will determine the amount down
The financing will then tell your your cash flow out. Figur
about 20% more than that for RE tax, insurance and such
To find current rent prices, look in the newspaper. That
the cash flow in. Charge higher than that and youll ge
few renters. Again, take some percent off that fo
landlord overhead like repairs, lawyers and such
Depending on geography the price to purchase might b
close to a match or very far away from a match. Mor
down, more chance of a match. So bascially your
looking for inflation to eventually raise the rents for
positive cash flow, or youre looking for a dont-wanter wh
isnt going to hold out for market price