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In most real estate markets, it's going to be hard to rent out a single family home purchased in the past 5 years with positive cash flow, factoring in a proper

In most real estate markets, it's going to be hard to rent out a single family home purchased in the past 5 years with positive cash flow, factoring in a property manager. The profit comes in when you account for appreciation of the property and the accumulation of principal. However, if you have the cash, this can be a good tax strategy -- trading an annual operating loss in return for long-term appreciation of the property. There are plenty of people who have owned their homes for 10-20 years who can make a decent profit in renting them out.

karmajunkie 11y ago
I'd add that this is mainly because in most markets the economics of buying a rental property are very different than buying a property to you want to live in. You end up taking on a larger mortgage for the latter, which drives up your minimum rental price, which may or may not be good for your market. If you've never run a property as a rental income property, there's a lot of nuances to that you have to be prepared for, like pricing your property to the market instead of to whether you like your tenants.