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I guess the majority of real estate I've owned would be considered dogs..
My goal was to buy one rental every year or so and was quite pleased to have a break-even after factoring in all costs... including a maintenance allowance, vacancy factor and return on cash on cash...
This "Conservative" approach has served me well and all but the last purchase are worth well more than what I have in them...
Not the easiest task when I'm located in one of the highest priced Real Estate markets in the United States...
Of course... I have colleagues that won't look at anything without a resident manager and with larger properties... it is much easier to make the numbers work...
Are any of your holdings in the San Francisco Bay Area?
My 2% rule is only one thing I look at you might say a starting point. But when my only income comes from rentals I need cash flow to live so breaking even would not work for me. I have a house in Hollywood hills were I used to live for a few years but not in San Francisco but I have been there.
i know this is an older post, but i'll chime in anyway. im in the seattle area, small town about an hour northeast of seattle actually. bought my current home, a small cbin on the river, with the profit from a previous home sale. put $25,000 down back in '06. a year later had $17,000 in equity. took the $17 grand and put it with the $22,000 i had in my independent retirement account, along with $32,000 i took out of my 401k, along with the $12,000 i had saved, and used it for a 20% down payment on split level, single family home on a sub-dividable .55 acre lot. the purchase price of the home was 280,000 at 5.25%. interest only. i put $80,000 down... when it was all said and done, bla bla bla... ultimately i ended up with a mortgage payment of nearly $1,350. figuring in taxes, insurance, and what not. i lived in the upstairs for two years while turning the downstairs into its own unit. now im back in my cabin and ive got renters in both the upstairs and downstairs of my other place. their combined rent covers the $1,350 mortgage payment and then some. the "then some" amount is just under $900.