Real Estate Investing FAQs
What is a good Cash-on-Cash Return?
Most investors aim for a Cash-on-Cash (CoC) return between 8% and 12%. However, in a perfect BRRRR deal where you pull 100% of your initial capital out during the refinance, your CoC return is technically infinite, as you are generating cash flow with none of your own money left in the deal.
How do I calculate ARV (After Repair Value)?
ARV is calculated by looking at "comps" (comparable sales). You need to find similar properties in the same neighborhood that have recently sold in fully renovated condition. A local real estate agent can often provide a CMA (Comparative Market Analysis) to help you determine an accurate ARV.
What is House Hacking?
House hacking is an investment strategy where you buy a multi-family property (like a duplex or triplex), live in one unit, and rent out the others. The rental income often covers your mortgage and expenses, allowing you to live for free while building equity.