What is a cash on cash return? #shorts #shorttermrentals #airbnb #airbnbhostingtips

Name: What is a cash on cash return? #shorts #shorttermrentals #airbnb #airbnbhostingtips
Uploaded: 2023-02-06T21:00:05+00:00
Duration: 58 s
Channel: Tim Hubbard
Description: Short YouTube video by Tim Hubbard explaining cash-on-cash return for property investments. Uses a simple example: $100,000 purchase, $20,000 down…

6 Feb 2023 · 1 min

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Short YouTube video by Tim Hubbard explaining cash-on-cash return for property investments. Uses a simple example: $100,000 purchase, $20,000 down payment, $10,000 annual expenses (mortgage, insurance, utilities), $10,000 net profit, yielding ~33.33% cash-on-cash return. The clip defines cash-on-cash return as cash received back versus cash invested in the property.

Questions this video answers

$100,000

$20,000

$10,000

Approximately 33.33%

Chapters

First of all, what is our cash on cash return? Well. Well, it's how much cash we get back versus how much we invested in the property. Now, the cash on cash return calculation happens here, right? So let's say a quick example. Let's say you bought a property for $100,000. I know those probably do not exist. Right. And you put $20,000 down as a down payment. And then throughout the year, your mortgage or insurance, your utilities, whatever it happened to be cost $10,000. So this hundred thousand dollar property, you have a total of $30,000 in cash out of pocket into the property. Now, let's say that after all those expenses, you made a net profit of $10,000. That would be really good. By the way, that would be a cash on cash return of about 33.33%. Right. That's pretty darn good.