BiggerPockets Real Estate Podcast

How to Make $5,000/Month with Rentals (Starting from Zero)

14 snips
Aug 8, 2025
Learn how to earn $5,000 a month in passive income through rental properties, even with little to no experience. Discover the importance of building equity over immediate cash flow for long-term success. The discussion reveals strategic planning for real estate investments, highlighting methods like the BRRRR strategy and how to transition from equity growth to generating consistent cash flow. Additionally, explore key metrics that optimize property selection, setting you on a path toward financial freedom.
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INSIGHT

Two Numbers To Reverse Engineer Cashflow

  • Dave Meyer says you can reverse-engineer rental cashflow with two metrics: total equity and return on equity.
  • Calculate equity as assets minus liabilities and ROE as annual cashflow divided by equity.
INSIGHT

500K Equity At 12% Hits $5K/Mo

  • $500,000 in equity at a 12% ROE produces $60,000 per year, which equals $5,000 monthly.
  • Framing goals as equity × ROE makes the $5k/month target concrete and measurable.
ADVICE

Prioritize Equity Before Cashflow

  • Do focus on building equity early instead of prioritizing maximum cashflow on your first deals.
  • Equity growth gives optionality later and makes achieving large passive income targets easier.
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