I put 20% down on rental. Getting 3k positive cash flow per year - after paying mortgage and maintenance. Question:should I pay the balance on the mortgage-$125k and pocket an additional 9k? Thoughts?

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With current interest rates, no

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Current state: 3k CF / 30k Invested = 10% return

What you’re proposing: 12k CF / 155k Invested = 8% return

Why not use the 125k to buy another couple units?

EDIT: Math

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Would love to know more about your purchase here. What location? Has HOA?

From what it looks.. you are making $1000 per month rent on a $160K property. That’s pretty awesome.

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Great!
Which city is this?

If you pay off the mortgage won’t it increase tax owed at year end due to a smaller expense?

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Buy another property

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With rates this low, go for another property! What’s your current rate?

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Yes I want to buy another property maybe multi unit but market has been hot. Same property will cost me 200k. And right now it’s like finding needle in the haystack

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With the appreciation, even on paper - don’t you calculate your return on perceived value?

ie 3K return over 60K now (assuming you sell at 200K and banks take its share. Leaving you with 60K) = 5%
Vs. calculating it as 3K on 30K you invested.

Buy more properties or invest In stocks. Your rent will rise over time and btw the tenants are paying all your equity.

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