Just talked to a friend who is a Norristown landlord. He has bought close to 20 homes in Norristown this year for around 40 to 50k a pop. He has added around 9k a month in positive cash flow. At 40k for a property that can rent for 1100 a month sec 8. Depending on how you borrow the purchase money you could have around a 400 to 500 dollar a month positive cash flow per unit.
Here is a hypothetical contrarian riches analysis. Buy 40 properties in Norristown over the next 5 years. You plan on holding and being a Landlord for 10 to 13 years. At 20k per month cash flow it's 240k per year times 10 years is 2.4million cash flow. Now it will be safe to assume these properties will sell for 75k 10 years later. That is fair market value today. On the conservative side we are making a 30k profit per unit pre tax, which will be around 23k after tax. Based on these numbers there is just short of a million dollar profit. All told between cash flow and capital gains the investor stands to make around 3million bucks on less than a 2 million dollar borrowed investment. Anyone got 2 million bucks to lend???? That's the missing link to this 3 million dollar puzzle.
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