Return On Buying A House

Managing Real Estate Broker

The reason the largest investment houses in the Country are buying houses by the hundreds is the return simply makes sense.

Real Estate is having a 50% Off Sale going on RIGHTNOWand that means IT’S TIME TO BUY.

There may never have been a greater time to buy with property values having come off previous High Values to such Low’s while at the same time Interest Rates have done the same.

A $500,000 House just a few years ago is now a $250,000 House.   But that’s only part of why you should start making offers on houses right away.

The other half of the equation is what that $250,000 House, that’s 50% Off will cost you monthly.  We buy houses with a monthly payment so let’s look at what that monthly payment would look like.


            $250,000 Purchase Price

            3.5% 30 Year Fixed Rate Mortgage - Cookie Cutter 30 Year Loan


            4.125% Fixed 30 Year Mortgage Investors. 

Lenders charge slightly higher rate for investment property loans. 


Owner Occupied:        


Down Payment             Mortgage Payment       Taxes/Ins.         Total Payment


            3% Down         = $7,500          $1,090                         $285 Mo          $1,375


            10% Down       = $25,000        $1,010                         $285Mo.         $1,295


20% Down       =$50,000         $895                            $285Mo.         $1,180



Investor 25% Down


Down Payment             Mortgage Payment       Taxes/Ins.         Total Payment


            25% Down = $62,500             $910                            $285 Mo          $1,195


The way to tell if it’s a good investment is to figure out how much cash out of pocket you would be investing.


            In this case it would be the down payment plus about 3% closing costs:

                        Example:  $50,000 Down + 3% Closing Costs = $7,500  Total: $57,500


            Invest $57,500


            Rental Income: $2,000 Per Month +- =                                    $24,000 Per Year


            Less Mortgage Payments, Property Taxes & Insurance =            $15,540


                                                                                    Net Income:     $8,460


                        INVESTMENT:           $57,500                      


                        RETURN:                    $8,460


                        RETURN ON INVESTMENT: 15%



            Call me at 707-578-2250 or Email me:


                        Thanks!   Scott Wolmuth, Broker “Scott The Broker”



            This simple reference equation does not consider:

            Appreciation Or The Increase Of The Investment in Value over Time

            Deprecation or the Tax Benefits and Write Offers

            Vacancy which in this Area is 5%+-epairs and Maintanance which we would consider to be offset by other Benefits


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