Amazon is branching into real estate through a partnership with Realogy, the nation’s biggest residential real estate broker, the company announced Tuesday.
How can you invest into real estate if a property costs 100k but the monthly rent is only around $350?
You could…but only if youmanage it yourself, and have to put all the rent into a savings account for future maintenance, repairs and vacancy.
The rent needs to be able to:
- cover the debt service (principal and interest)
- cover taxes and insurance
- cover future vacancy, future repairs, future capital expenses (a rainy day fund).
- cover any other miscellaneous expenses.
- and what’s left over can be treated as profit (you keep)
Typically the monthly rent needs to be at least 1% of the total purchase cost to support all this, but you need to run the numbers on each one.
The property you’re describing would not be a good deal to me.