How Many Rental Properties Do You Need to Be Able to Retire?
Here’s the general formula:
The monthly amount needed for retirement ÷ The cash flow per rental property = The number of rental properties you will need
Remember:
Cash flow = Income – Expenses
For example, Kate needs to make a monthly income of $6,000 per month to be able to retire. Kate bought a few rental properties and calculated an average of $300 per month in cash flow per rental property. How many properties does she need to retire?
$6,000 ÷ $300 (per rental property) = 20 properties
Kate should be on track for her retirement if she purchases 20 rental properties.
Kong Property Management Group provides property management and leasing services to the greater part of Silicon Valley. We specialize in single-family homes, condos, townhomes, duplexes, as well as apartment buildings. Based in San Jose, Kong Property Management Group is a local and family-owned business with over 15 years of combined experience in residential property management, real estate sales, and appraisal.