6. How much rent do you need to charge ?

An Example of a Good Rental Cash Flow

Here’s how the numbers work for one of my rentals in Owings Mills, Maryland. This property is a condominium, so I don’t need to budget for a new roof or outside maintenance, such as landscaping and snow removal. The condo fee also covers water/sewer, and the tenant pays the only utility bill, which is electricity.

Total Rental Income$17,100$1,425
Mortgage interest$6,424$535
Condo fee$2,460$205
Renter license renewal$60$5
“It’s Gonna Break” fund$500$42
Total Expenses$13,125$1,094
Cash Flow$3,975$331

As you can see, the property is $331 cash flow positive each month. If the tenant renews the lease (and they usually do), there’s no vacancy cost and that $1,425 flows to the bottom line. If nothing breaks, that’s another expense that was budgeted but not incurred, which also flows to the bottom line.

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