#397 Rentals By The Numbers, PT 1 on Flipping America Radio

Published: July 31, 2020, 2:11 a.m.

The next two shows are probably the most concise, most complete breakdown of the numbers involved in income-producing properties you will EVER hear for free. You are going to want to listen to this multiple times and take good notes. I’m not kidding. As we break this down today and next time you are going to hear about the impact of the purchase price and the initial rent-ready repairs. You’re going to learn about
Interest Rates
Loan Constant
Expense ratio (or just a total of realistic expenses)
You will learn the TIMMR acronym: Taxes Insurance Maintenance Management Repairs
Cash on Cash Return (no leverage - just used to compare one property with another, but doesn’t tell the whole picture)
Return on Cash (leverage)
Return on Equity (tells me when I need to re-fi)
Capitalization rate. Measure of your net income relative to the price of the asset.

For the first time ever on this show we are going to tell you how to look at risk.
Debt Service Coverage Ratio
Break Even Ratio