LANDLORDING 101 – CASH FLOW KAREN RITTENHOUSE
What if you can’t charge enough to cover your costs?
If the rental amount is at least close to your cost of owning, it should allow you to put in a tenant who will
contribute to your expenses, pay down your mortgage, and allow you to receive tax benefits while they rent.
Your annual rental increases will eventually get you to a place where the rent covers your expenses and, finally,
generates profit. Remember, rents will increase over time but your mortgage payments will not, so eventually
your tenants will be paying more for the property than you do.
If you haven’t yet made a purchase, only buy a property where the monthly rental amount will more than cover
your expenses. It’s never good to own a property that takes money out of your pocket every month. There are
plenty of homes on the market, so buy one that will provide cash flow.
Karen Rittenhouse
Karen Rittenhouse has been investing in real estate full time since January 2005. In that time,
she has purchased hundreds of single family properties, opened a full-service real estate
company, a property management company, a coaching/training business, and written three
books on real estate, The Essential Handbook for Buying a Home, The Essential Handbook for
Selling a Home, and The Essential Handbook for Landlords.