Why am I thinking about rental properties? Well, many of us real estate investors own a portfolio of rental properties. It’s the thing to do, according to all those classes we take and books we read. Because we are good investors, all of us at Hermit Haus have rental properties, both as a group and separately. We have them to provide a steady source of income that we can rely on, or as they say in the biz, cash flow.
A good rental property owner knows to take into account insurance, property taxes, any mortgage on the property, and anticipated repairs into account while figuring out exactly how much cash is going to flow. That’s smart.
Lately though, some of our properties have had one issue after another. The hot water doesn’t work. The air conditioner has a problem. Is that mold or just mildew from the recent rain? We want to replace the floor. Our drainage is bad. As you can imagine, that eats into the old cash flow. It’s hard to guess how much maintenance a house is going to need per year. Houses are like that.