How do you know if a rental property will make enough cash flow before you buy? Budgeting is KEY. When breaking down a deal, it’s critical that you account for the costs of all capital expenditures (CapEx), maintenance, and repairs. Overlooking an important line item could easily put you in the red!

Welcome back to another Rookie Reply! In today’s episode, we’re going to show you how to budget for the everyday operating costs that come with owning rental properties, as well as how to set minimum cash flow requirements when analyzing a rental. Should you find a partner for your next house hack? We get into the potential advantages and disadvantages of joining forces with other investors. We also talk about the many tax benefits in real estate and whether you need a limited liability company (LLC) to maximize them!

If you want Ashley and Tony to answer a real estate question, you can post in the Real Estate Rookie Facebook Group, call us at the Rookie Request Line (18885ROOKIE), or click here: https://www.biggerpockets.com/reply?u...'>https://www.biggerpockets.com/reply?u...

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Books Mentioned in This Episode:
“The Book on Tax Strategies for the Savvy Real Estate Investor”: https://store.biggerpockets.com/produ...
“The Book on Advanced Tax Strategies”: https://store.biggerpockets.com/produ...
“Real Estate Partnerships”: https://www.biggerpockets.com/partner...
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Real Estate Rookie 255 How to (Legally) Avoid Taxes by Investing in Real Estate:
https://www.biggerpockets.com/blog/ro...
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Real Estate Rookie 77 CPA Answers Depreciation, HouseHacking, and Rookie Tax Questions:
https://www.biggerpockets.com/blog/ro...
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Connect with Ashley and Tony on BiggerPockets:
Ashley: https://www.biggerpockets.com/users/e...
Tony: https://www.biggerpockets.com/users/t...
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Shoot Ashley and Tony a Question on Instagram!
@wealthfromrentals or   / wealthfromrentals  
@tonyjrobinson or   / tonyjrobinson  

Show notes at https://link.chtbl.com/Rookie


00:00 Intro

00:31 Claiming Tax WriteOffs

03:50 Budgeting for Property Expenses

15:33 Partnering on a House Hack?

23:22 CapEx vs. Repairs & Maintenance

26:17 How Much Cash Flow Do You Need?

32:17 Send Us Your Question!