How do you measure fire readiness when it Comes to real estate ?

My current + pipeline homes (2-3) year stats:
Purchase (10 homes) 4.3M
Down- about 25%
Market value- guess if 5.4M
Equity of 2.1M , net equity of 1.0 if exclude my down payments
Cash on cash isn’t best but about 4.5% ( lived in some of these homes)
Net income- 50k/yr

Clearly high assets and loans with small cash compared to current income but building wealth. How to measure fire - income? Wealth accumulation?

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I would look at net cash flow over time. As you begin to pay off some of these properties your net will increase significantly with the mortgage payments gone. You probably just need to put together a simple timeline of when each property will be paid off and what it will bring in in rent. That’s how I’d think about it.

Be careful with growth like this

Agree. it’s a bit of a concern for sure. We are pulling back on stocks and moving funds here. I have a pretty healthy cash fund though from previous sales. We have relatively high income near 400 and should go up next year before these all start closing so we have some cushion there too.

I’d measure wealth as assets less liabilities.

Don’t count anything until you have it sort of thing

Agreed with wealth but often people speak of 3 or4% withdrawals from stocks to live from. That’s how to calculate total assets needed to then retire if you wanted a certain amount of spend per year to protect your meet egg (stocks)

I guess an equivalent then is literally just the cash returns and the nest egg remains untouched (the real estate equity).

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