How about combining a Rental Investment with a Rent to Own Investment?
Namely; I`m presenting an investment to my friends, to purchase an 8 Plex in a prime area in the city; however the return now is not that great, it`s roughly 3% cash on cash and 7% including capital repayments. The upside to this investment is that the area is experiencing strong appreciation and a very low vacancy. Additionally the rents are well below market value.
At the same time I`m working on a Rent to own deal which will provide roughly 22% annual cash return, so maybe combine them both and offer it as a package?
It will look as followed;
Investment for 8 Plex - $210,000
Cash return - $6,835.00
Investment for RTO - $36,191.18
Cash return - $7,992.00
Total Investment - $246,191.18
Total Cash return - $14,827
Cash ROI ` 6%
Experts; what are the pros and cons of this concept?
Namely; I`m presenting an investment to my friends, to purchase an 8 Plex in a prime area in the city; however the return now is not that great, it`s roughly 3% cash on cash and 7% including capital repayments. The upside to this investment is that the area is experiencing strong appreciation and a very low vacancy. Additionally the rents are well below market value.
At the same time I`m working on a Rent to own deal which will provide roughly 22% annual cash return, so maybe combine them both and offer it as a package?
It will look as followed;
Investment for 8 Plex - $210,000
Cash return - $6,835.00
Investment for RTO - $36,191.18
Cash return - $7,992.00
Total Investment - $246,191.18
Total Cash return - $14,827
Cash ROI ` 6%
Experts; what are the pros and cons of this concept?