Passive Real Estate Investing TBT : Ask Marco - Should I Refinance our Rental to Buy More Properties?
Aug 14, 2025
A listener considers refinancing a nearly paid-off rental to invest in more cash-flowing properties. The discussion emphasizes that leveraging equity can enhance overall income, even with new debt. Factors like long-term cash flow and location are crucial when evaluating potential investments. The conversation also delves into the viability of short-term rentals in multifamily properties, pointing out their market demand versus the stability offered by long-term rentals. Overall, strategic financing can lead to wealth-building opportunities.
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Turn Equity Into More Rentals
- Do a cash-out refinance on an equity-rich rental to fund down payments for more rentals if the numbers work.
- Multiply one property's equity into several cash-flowing properties to often increase total net income.
Debt Can Increase Aggregate Cash Flow
- Even with added mortgages, aggregate net cash flow from multiple properties typically exceeds a single paid-off property.
- Financing multiplies income and accelerates long-term wealth when properties appreciate.
Run The Numbers First
- Run detailed, assumption-based math before refinancing and buying more properties.
- Use a spreadsheet or the podcast's cash-flow tool to model net cash flow and debt service scenarios.