No postings of any consequence for a few days. Making a road trip to the east with my17 year old. He’s looking at Princeton and a couple other schools. Personally, I’m rooting for Princeton. Plus, it’s a good excuse to go on in to New York City for a couple days.
Anyone want to suggest a good pizza joint in NYC?
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With apologies to Waylon Jennings & Willie Nelson, it’s time for me to get back to the basics of my real estate love. Real estate investing. Now, while I won’t be discussing Luckenback, Texas, I will be discussing my home town area of Kansas City.
How Do I Know If The Rental Property I’m Buying Will Be Profitable?
Real estate investing in Kansas City is not very complicated. It can be treacherous to those that don’t heed to common sense. But it’s not too complicated. In a nutshell here is the basic formula for determining whether or not a rental property you are considering will be profitable or not;
Income (projected)
– Expenses (projected)
= Cash flow (positive or negative)
There! That’s it!
Income can take on many variables. There is income from rent, laundry, parking, late fees, etc.
Expenses can take on many more variables. There is, of course, the mortgage. There are also insurance, property management, maintenance, upkeep, legal and “future” expenses. (That is by no means a complete list of expenses.)
Learning how to project income and expenses is where the rubber meets the road. And once you know what the Net Operating Income of a property is you can then set a value.
Not sure how to determine and then work from Net Operating Income? Stay tuned.
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I’m currently working on my State of the Market Report for Kansas City real estate owners and investors. It should be out on Thrusday. Check this blog and/or your email if you’re on my list.
I think you’ll find it interesting.
Chris
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Sometimes I just have short little real estate thoughts I like to share. You can find them on my facebook Olathe Real Estate page. I’d love it if you went over and made yourself a fan.
In the mean time, feel free to read this story of mortgage fraud artists finally getting what’s coming to them. From today’s Kansas City Star…
KCK man, Leawood woman sentenced in $14 million mortgage plot
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Let’s see. My phone is ringing more. A lot more. My referrals to lenders is up. I listed a duplex and a single family home in the past two weeks. I have another listing coming up before the end of this month. And two new buyers to work with. Hmmm. It must be getting close to spring.
Now if we could just mix in some blue sky…
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Okay, so we’re trying to close on a house that had a new roof installed and a upgraded electricity put in. The underwriter doesn’t want to take my word for it that the work is done. That I understand. After all, I stand to make money on the deal. But he hasn’t answered as to whether or not receipts are acceptable. And no inspector wants to check off on the roof because there is 6″ of snow on it, the temps are below 10 degrees, they say 2″-4″ more of snow is coming tomorrow and finally, temps are not expected to rise above 30 degrees for the next ten days.
Are we just supposed to delay closing until June? 🙂
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It’s a crazy time of year. Some people are working. Some are not. Hey, it’s Christmas and New Year’s and we just finished Chanukah…
Then you add on 8″-10″ of snow…
And yet, I had to go by a house earlier to check on the completion of repairs so we can close tomorrow (not going to happen) and I have an appointment in about an hour from now to go wading knee deep in snow to show a HUD home that is for sale.
Ah, I love the winters in Kansas. 🙂
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BBQ Capital | Kansas City Real Estate Investing 