[AwesomeFaic]

Depends how much money you can invest right now, how much time you have to spend, and how quickly you need to start hitting that $2000 mark.

Need it now? Check out Craigslist gigs (help with moving, quick jobs, website help), or try flipping thrift store and eBay stuff. Pros: Quick, no skills needed. Cons: Unreliable and more time consuming.

Need it reliably? Work on a business and work your ass off in your spare time. Pros: Easy to make more than $2000/mo if it goes well. Cons: Will take a lot of time and effort to maybe work out for you.

Alternatively, invest in a property. Pros: Easy $2000/mo through rent. Cons: Lots of upfront investment & research needed to not screw yourself over as a property manager.

Personally I'm in a similar situation and currently selling on eBay and running a side business. Been at it ~6 months and make 200-400/mo on top of my salary, but looking to ramp up the business more this year.

Edit: One option I overlooked of course is investing. The safer the investment, the more up-front capital you'll need and nothing is truly 100% safe. Gamble on options but be prepared to lose everything, if you really need something immediately.

[CoffeePython]

It might take a while to make $2k/mo in cash from rental properties. We own two rentals and don’t even clear $1k/mo with both.

[davismwfl]

Depends on a lot of factors, I have made that on a single property (short term vacation rentals) but more typical is like what you say where it can take 10+ properties to clear $2k/month for long term rentals. Right now my best property is clearing two hundred (or so) a month, which isn't horrid but far from great. I only have long term rentals right now though, so that's ok.

IMO: Rental property is best looked at as a long game, not a short term income stream. It is a solid way to gain wealth, just won't happen overnight.

[aguyfromnb]

>I have made that on a single property (short term vacation rentals)

Not going to make assumptions about your specific case, but many people using AirBnB are breaking the law and/or are vastly under-insured to be renting out property short-term. One lawsuit or accident and any "profits" (and much more) will be wiped out.

Real-estate is an old, mature business. There's no magic in how to make money in it, nor are their outsized benefits.

[davismwfl]

Yea, I've been doing this long before AirBnB existed, and actually I've never registered one of my properties with them.

In my state we have to pay monthly sales tax on rentals less than 6 months along with a number of other basic rules too (including insurance). But none of them are hard to follow, AirBnB violates them constantly however.

Making good money on vacation rentals in beachfront towns is very doable. We used to be able to buy cheap properties and rent them for $1-2k/week for vacation rentals, and they'd stay busy most of the year, meaning after expenses it was pretty easy to clear $2k if you bought right. Now that is not so easy given the cost of real-estate even with capital being fairly cheap.

edit: clarified the sales tax.

[pxhb]

Somewhat of a tangent, but do you have any advice/resources on how to price in repairs and maintenance?

I am moving soonish, and trying to figure out what to do with my house. A back of the envelope calculation of Expected_Rent - Mortgage - Insurance - Property_management_fees gives an appealing number, but I am not too sure how to price in all of the long and short term repairs/maintenance and any other potential liabilities.

[davismwfl]

In general, property management fees run roughly 6-10% of rent and maintenance really depends on the age of the home. A newer home that is in good shape may not cost you more than a few hundred dollars per year in unexpected expenses, an older home plan around $1-2k/year to be safe. In my rentals I always price into the rent some core expenses, specifically lawn & exterior care as well as pest management. This lets me make sure the property stays looking proper and reduces the chances I need to do major upkeep work/expenses. Inside I always paint the house between long term rentals, which means the inside stays good, and I usually install wood/laminate floors before I start renting and keep decent appliances in them as well. This means I rarely have any larger expenses, after my first initial market expense.

Some things to look into are things like property taxes, a rental isn't your primary home and so depending on your state the property taxes may increase once you rent it out. HOA's sometimes have rules about notifications, fees and lease terms you have to take into account (I hate HOA's).

Best way to find out your specific details is to talk with a rental agent in your area and ask them to give you an estimate. They'll know the quality of the homes in the area and the approximate costs owners are paying annually. That'll give you a baseline, and I'd ask 2-3 to make sure you aren't getting an edge case.

FWIW: My higher end properties cost me less (% wise) in maintenance than the lower end homes, simply because it is a vastly different cliental and quality of home. If your house is a typical middle class home for your area that is almost always the sweet spot IMO. Higher end can be harder to rent out and lower can be tougher to manage and keep up with.

[HeyLaughingBoy]

When I did this (rented out the suburban single-family house I used to live in), if something needed repairing, I'd just drop by after work and fix it myself since I only lived half an hour away. I set my rent based on the market rate.

It turned out that insurance on a rental property was less than on an owner-occupied one, which made no sense to me, but I wasn't going to argue with MetLife :-)

Basically, the floor of your monthly rent should be your existing costs: mortgage, insurance, property taxes, average annual repair costs, etc. In markets I was familiar with, this was always well under what rent would cost. Also, bear in mind that repairs and other expenses like property taxes and mortgage interest are now deductible since the rental is a business.

IIRC I had around $1,000/mo in cashflow from the rental before factoring in savings from the additional deductible items. I sold the property after three years since I didn't really want to be a landlord, but it was free money.

[matt_the_bass]

Don’t you have a good idea of the maintenance needs for that house? You lived there.

If you don’t understand the costs of living in it as your primary residence, you perhaps should consider that realestate Investing/management might Not be a good match for your skill set.

[pxhb]

I have an idea what it costs me personally, but I am not sure how to price in the plain fact that renters will not care for your house as much as you do.

[davismwfl]

And you are right to ask this question. Your costs when you live in the house will not be the same as when someone else moves in. It is also why I suggest you talk to a local agent or 2 because they will know the trends in your area.

I had a house in one city that the maintenance cost was outrageous compared to my other properties but it was in the middle of the pack (cost wise) for the city demographics and building codes. So it is hard to pinpoint even for an experienced real estate person without doing some analysis in your area specifically.

Here are a few of my common questions to an agent if I am looking at a new area:

1. Average time on market, from day of rental listing to lease signed.

2. Basic demographics and occupations of the people living in the neighborhood and surrounding area. Including average income.

3. Hardest to rent property details compared to the easiest to rent. e.g. 4 bedrooms might be super hard to rent in an area with predominately single people, but would be super easy in a family driven neighborhood. I'm looking for contradictions here, e.g. they say the area is predominately housing single people but the demand is for 4 bed/3bath houses. Either they are idiots, or it is group housing/party area which can bring up a different set of rental criteria. Or there is something super unique about this area and they should be able to articulate it to me or I don't accept that risk.

4. Average cost of maintenance for similar rentals. I usually ask, avg plumber cost, avg electrician if I don't have people in the area so this way I know what they are seeing.

5. Special lease terms that are needed or common for the area. And special county/city or HOA rules or costs I need to be aware of. Including parking fees etc.

6. Largest employers in the area by number of people.

[matt_the_bass]

Ahh got it! Thanks! Sorry, I didn’t understand before.

[fastbeef]

Seems like a crazy amount of risk for $200?

[jakemal]

I'd imagine that is net cash per month. But they would still be building equity.

[davismwfl]

Correct, net after all expenses. My goal is always to have 100-200 free at a minimum but in the end the rental cashflow isn't to build monthly income (in my case), but instead to build equity in the property.

There was a period of time I did it for monthly cash flow, and when I did that I'd target different types of properties and target a different minimum free cash flow. But I switched my investment strategy to be one to maximize equity and property value, I've found this to be far more profitable in the medium to long term, but obviously doesn't provide the highest monthly income initially.

[AwesomeFaic]

I know a couple people who have very desirable Florida condos (as well as other properties) and each condo alone is doing ~2k. Granted that's day-by-day, not a monthly rental.

[smithmayowa]

Will like to learn more about the eBay sales, is it location dependent? How can I also reach out to you? My email is smithmayowa20 at gmail.com

[AwesomeFaic]

I can give you the run-down. I have a contact form on https://bigboys.nyc, will give you the eBay spiel after I'm out of work