How to Calculate Numbers on a Rental Property

Discover our straight-forward and easy to use formula for calculating the numbers on a prospective rental property purchase.

Welcome to Hipster’s first how-to video! I’m going to show you how to run quick numbers on a rental property. You can use this easy and fast formula for any property you’re looking at. I’ll be behind the scenes doing the calculations on my white board and calculator (yes, it really is that big!) to show you how it works. This is an actual rental property I’m using as an example, including the actual purchase price and numbers. (You have to love my handwriting!) You always want to verify the numbers you run before you buy any property (for example, with a property manager), but it helps to do your homework first. This particular house is in Indianapolis and gets $1,075 in rent. It was built in 2002. Super cute little house: three bedroom, two bath. But all we care about right now is the numbers…

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20 thoughts on “How to Calculate Numbers on a Rental Property”

  1. so are most of the people making these how-to videos wealthy as shit, and just helping for the sake of being helpful, or are they failing in rental property investing, and in turn becoming gurus?

  2. Were is the capital repayments? If the property falls in value to $80,000 your deposit is gone! What a stupid greedy woman. why don't you stay at home and cook instead of living the life of a parasite.

  3. Great Video – easy to follow.
    I have a mortgage being paid off, need 13 more years. If I buy another propert to rent, with a loan, what do I do with the profit? Use it to pay my property or pay the rental property?

  4. I understand you are trying to be helpful, but the video is very misleading because it does not take into account capital expenditures (CAPEX). Without accounting for CAPEX, you might end up losing money. But you are in the business of selling turn keys and need to show higher cap rate to your investors, so the CAPEX is conveniently ignored.

  5. Don't forget the equity your building each year.  Its actually more than 14% return. Also there is the property appreciation for both situations. These numbers are not unrealistic. You just have to be patient and not pay too much.

  6. How do you factor in a HELOC as a down payment? I would want the principle and interest of both loans to be covered by the rental income.

  7. So you go to a property manager and ask them to calculate rent on a place you don't know own and they will do that? Is that how you find out the rent estimate??? Thanks for the video btw great help!

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