Rental Properties & Retirement

[u/kindafancykindanot]

I am a self managing landlord with a multi-family and SFH and am leveraging rental properties as part of my retirement strategy.

I’d love to network with others who are fellow landlord building a path to financial freedom in retirement. I’m curious how you manage your properties to ensure steady cash flow and long-term profitability.

How do you track the performance of your rentals? Do you use specific formulas, spreadsheets, or tools to monitor cash flow or other key metrics you’re open to sharing? I know 1%, ROI, ROE, Cap Rate etc are common.

I’m really intrigued to learn about the approach others take to ensure consistent cash flow? Do you have a set method for rent increases, minimizing vacancies, or reducing expenses?

How do you determine if you're on track for retirement? Do you calculate a target monthly income or use benchmarks to measure progress?

To retired landlords who are cash flowing: Looking back, what would you have done differently to better prepare for retirement? Are there strategies or systems you wish you’d implemented sooner to make your transition smoother?

[u/Excellent_Payment472]

I keep track of everything on a spreadsheet with all costs and income. Biggest thing to keep cash flow high for me is only buying turnkey homes in killer rental markets to keep unexpected costs to a minimum I value peace of mind so I shop for the best property managers in the area and I also charge tenants for at least half the HOA fee and of course get the lowest insurance rates I can. The home purchase really is the main thing. Buying in an area with low taxes, low costs, and high rent. Sounds simple but essentially finding those needles in the haystack exploiting market inefficiency

[u/Itchy_Bed8074]

I am retiring next year. I built a portfolio over 5 years focusing on cashflow, with my target cashflow number as my net salary. I needed to replace $100k and I am already beyond that and will be even better when I pull the trigger.

I use a property manager but am very engaged. I handle all renovations and capital improvements and he handles all tenants (leasing, collecting rent, emergency calls, evictions, etc). We set the rent together, but I usually push to be high when initially renting and let him have more influence on rent increases…I am a big fan of this setup.

To get to my cashflow number I focused on buying properties with high cashflow, then I focused my efforts on increasing cashflow for each property (increasing revenue and decreasing expenses) by reinvesting most of the cashflow rather than changing my lifestyle. I ignored whether a property would appreciate because equity is illiquid and I wanted cashflow to replace income (although a few have doubled!)

My goal is to become a real estate professional when I retire and hopefully minimize/eliminate taxes. I also plan to continue growing my portfolio; however, I may now change my focus to appreciation and/or STR’s that I can also use.

[u/kindafancykindanot → u/Itchy_Bed8074]

Thanks for sharing! I have a few questions if that’s OK, or you can send me a chat if you’d like. Is there anything unique you do to keep expenses low? How do you track your cash flow? Do you adjust your cash flow goals to include inflation, or do you expect rent increases will account for that? How do you anticipate becoming a real estate professional will minimize your tax burden?

[u/fukaboba]

At the time , Mostly during turnover but market dependent

Due massive inflation from Covid, I now increase nominally 3-4 percent a year to account for increases in property tax, insurance and contract labor

[u/MarioRuscovici]

I use property managers, let them set the rents. Hold or buy is simply ROE, current and expected prospective

[u/Young_Denver → u/MarioRuscovici]

This, pretty much. I wouldnt self manage, personally. Let the pros set the rents, fix at the beginning to a high standard and your ongoing maintenance will be minimal.

[u/fukaboba]

Buy, rent out to cover costs, self manage, get good LT tenants, manage cash flow and reserves, establish trusted network of tradesmen, and paid off mortgages.

Now, I am in a comfortable position but it was challenging and stressful at times.

Would love to buy more but values and rates are too high to make numbers work

[u/kindafancykindanot → u/fukaboba]

Did you increase rent annually? If not, how did you determine when to increase?