Investment Strategies
| Strategy | How It Works | Best For |
|---|
| Buy & Hold | Purchase, rent out, hold long-term for appreciation + cash flow | Passive income, wealth building |
| BRRRR | Buy, Rehab, Rent, Refinance, Repeat — recycle capital | Scaling a portfolio quickly |
| House Hacking | Live in one unit, rent others — often FHA loan with 3.5% down | First-time investors |
| REITs | Publicly traded real estate companies — invest like stocks | Passive, liquid, low minimum |
Key Metrics
| Metric | Formula | Target |
|---|
| Cash Flow | Rent — (Mortgage + Taxes + Insurance + Maintenance + Vacancy) | Positive, $100-300+/door |
| Cap Rate | Annual NOI ÷ Property Price | 5-10% depending on market |
| Cash-on-Cash Return | Annual Cash Flow ÷ Total Cash Invested | 8-12%+ |
| 1% Rule | Monthly Rent ≥ 1% of Purchase Price | Quick screening tool |
Expense Rules of Thumb
| Expense | Estimate |
|---|
| Vacancy | 5-10% of gross rent |
| Maintenance | 10-15% of gross rent (more for older properties) |
| Property Management | 8-12% of gross rent |
| CapEx (roof, HVAC, etc.) | 5-10% of gross rent (reserve fund) |
Financing Options
| Loan Type | Down Payment | Notes |
|---|
| Conventional | 20-25% (investment) | Best rates for investors |
| FHA | 3.5% | Owner-occupied only — good for house hacking |
| VA | 0% | Veterans — must be primary residence |
Pro Tip: Run your numbers conservatively — assume 10% vacancy, 15% maintenance, and 10% management even if you self-manage. If the deal still cash flows, it's a good deal. If it only works with optimistic assumptions, walk away.