Real Estate Investing with Coach Carson #434: Can You Really Earn 15% Returns on Rental Properties?
Aug 8, 2025
Can you really earn 15% returns on rental properties? The discussion dives into leveraged mortgages and potential risks, revealing strategies to enhance returns. By analyzing a specific case in Clemson, valuable insights into pricing and purchasing tactics emerge. Key financial metrics like rent-to-price ratio and net operating income are explored, emphasizing the necessity of thorough preliminary analyses in making informed investment choices. It's a blend of optimism and strategic planning for aspiring rental property investors.
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Leverage Is Key to 15% Returns
- To achieve 15% returns in real estate, you must use leverage such as a mortgage.
- Carefully pick properties and run numbers to avoid taking crazy risks despite borrowing money.
Real Example of Property Purchase
- Chad gives an example of buying a single-family house in Clemson, SC for $240,000 all-in.
- The property rents for $1,900 monthly, about a 0.79% rent to price ratio, slightly below the 1% rule.
Calculate Net Operating Income (NOI)
- Always calculate your net operating income (NOI) by subtracting expenses from gross rent.
- Use NOI to understand the true income available to cover mortgage and generate cash flow.
