[Spooky23]

Passive describes the level of effort, not the investment. Usually passive income is rent-seeking.

Property management is a great example. I can buy a cheap house in a lousy neighborhood, make a modest capital investment, sign up with Section 8 and get pre-screened tenants with guaranteed cash flow. My marginal work output is very low - a few hours a month.

I used to lease a few acres of land to a farmer. The only work was meeting to have a cup of coffee and exchange the check and paying the taxes. :)

[beatgammit]

And your work per month could be contracted out, so you don't actually need to do any more effort than meeting with your account periodically to make sure you're making money.

[Spooky23]

I know of a guy who has 3 employees who coordinate aboit 800-100 properties.

He probably turns over something like $20M, and can use the portfolio to write off profits from other businesses.

[marktangotango]

Is that 80-100 or 800-1000? I have one single family rental and a new roof(hail damage), busted water pipe, and toilet wax seal cost me $5000 this year and that was with insurance covering 2/3 the roof) That was my profit for several years. Ie I don’t see how this is profitable to anyone.

[maerF0x0]

A big part of that game is capital costs vs inflation.

Someone who bought their home before a price boom can often turn a profit because the rents follow the price to purchase (roughly speaking).

So if you acquired a bunch of properties in 2008 after there was a crisis, its likely that they're very profitable (month to month) now

[40something]

It’s because most “gurus” don’t actually own and manage properties. The only way I can make a double digit cap rate in the hood is by doing all the maintenance and labor myself.