Rentals No Longer Viable (Patreon)

Buying a rental property in America is no longer viable or profitable.

Investors stopped buying investment properties.

Because the current mortgage rate (6.1%) is significantly higher than the profit/cap rate (4.4%) of rentals.

This means that any investor who uses debt to finance their purchase is likely losing money on cash flow from Day 1.

Note how from 2012-2022, the opposite was true. Cap Rates were higher than mortgage interest. Which is why so many people piled into single-family rentals.

No longer the case.

Now if you can bridge it, perhaps some good deals could be had but as always cash is kind. Then hold out for rates to fall and use financing at that time.