GuideRentals
Keep it or sell it
See what a house would pay you each month as a rental, and how much of your cash a refinance hands back, next to what selling clears.
- Where it is
- A house › Deal › Analysis › Rent it instead?
- Who can use it
- Owners and admins
Rent it instead? sits on the Analysis page under the worksheet. It answers the BRRRR question: if you keep this house, refinance, and rent it, what does it pay, and how much of your money stays in it?
Fill in the plan
- Step 1: Under Rent, type the Monthly rent and the Vacancy percent. Results appear on the right as you type.
- Step 2: Under Running it, type Property taxes and Landlord insurance for the year, HOA and Other for the month, and the percents of rent for Property management, Repairs, and Saving for big repairs.
- Step 3: Under Refinance, leave Appraised value blank to use your ARV, and set Loan to value, Interest rate, Term, and Closing costs.
- Step 4: Choose Save rental plan.
The plan starts with typical figures you can change: 5% vacancy, 5% for repairs, 5% saved for big repairs, a 75% loan at 7.5% over 30 years.
Read the answer
| Figure | What it tells you |
|---|---|
| Keep it: cash flow each month | Rent after vacancy, minus running costs, minus the loan payment |
| Cash back to you | The new loan, minus what pays off today's loans and the closing costs. Reads Cash you bring when it's negative. |
| Your cash left in the house | Everything the house cost you, minus the new loan. None means you got it all back. |
| Cash-on-cash | A year's cash flow divided by the cash you left in |
| Cap rate | A year's income before the loan, divided by the appraised value |
| Debt coverage | Income before the loan, divided by the loan payment. Many rental lenders want 1.2× or more. |
Say Dana could rent 1418 Maple Avenue for $2,150 a month. With 5% vacancy, rent after vacancy is $2,042.50. The Or sell it panel puts that beside the flip: “Projected profit: $21,093.35, once.”
Decide
If you're keeping it, choose We're keeping it: mark it rented. The house moves to the Rented stage and gains a Rental group in its menu. Then choose Add the lease and track rent.
Compare exits, just below, shows this plan beside flipping and wholesaling. The Deals dashboard shows it for every house under If you rent it.