You know what separates struggling investors from great investors?
2 words. Good Math.
I’m a numbers guy. You live by the numbers or you die by them in the real estate game. Short of divine intervention, no amount of luck, sorcery or practical know-how can save you from a bad property if the numbers simply don’t work.
It’s no secret. It’s just slightly elusive. And honestly, I totally understand how SO MANY landlords fall into this trap.
Most new investors will get an approval letter from the bank saying they can afford a property worth “X” so they calculate their mortgage payments, potential rental income & property taxes and sign on the dotted line.
The truth is, that there is so much more to consider! That’s why I always run all of the numbers before even considering a purchase. While it may be tempting to take shortcuts like using the famous “50% Rule” when vetting properties, shortcuts like this can be disastrous when you’re on the hook for hundreds of thousands of dollars.