What Is Cash on Cash Return in Real Estate?

In this tutorial video, we'll explain what real estate investors mean when they talk about cash on cash, or cash on cash return in real estate parlance. We'll explain how cash on cash return has nothing to do with accounting or tax metrics, and how it's purely a cash flow based metric.

Save 2% When You Buy: https://www.hauseit.com/buyer-closing-credit/

We'll also explain the concept of cash on cash for real estate via a live example of a hypothetical investment condo purchase in Miami, Florida. We'll use Hauseit's Rental Property Calculator to see what the cap rates and cash on cash returns might be with financing.

Just remember that cash on cash essentially calculating how much cash flow you're getting as a percentage of your upfront cash investment. Your upfront cash investment is your downpayment, closing costs and any upfront renovation work. Your cash flow is how much cash you're getting back after your mortgage payment (principal & interest), common charges, real estate taxes, home insurance etc.

Remember, this is not an accounting figure, and you shouldn't assume this is any sort of taxable income figure. Consult your attorney and accountants, this is not legal nor financial advice.

If you have any questions, please leave us a comment below. Hit like, subscribe if you like what we see. Thank you!

Need to sell? Save all 6% in broker commission with our Agent Assisted FSBO listing service: https://www.hauseit.com/agent-assisted-fsbo/

Learn more about closing costs for buyers in Florida: https://www.hauseit.com/closing-costs-for-buyer-in-florida/
.
.
Hauseit Group LLC, Licensed Real Estate Broker
Tel: (888) 494-8258 | https://www.hauseit.com
_
#hauseit #hauseitmiami #hauseitflorida