Quote:
Originally Posted by hmmhmmcamo
And GP_Matt’s comment about being a few years away from being cash flow positive makes me smile as a renter because I look at his/her loss each month as money in my pocket (sorry). I understand that for him/her it’s a longer term investment and that’s fine, but in the short term as a renter it makes my monthly cost of living less and allows me the flexibility to spend that extra money how I choose.
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There is some confusion about cash flow positive I think. Every month when I make the mortgage payment on my rental I pay about $1100 of which ~$300 goes to interest and the other $800 goes towards principal. So every month on a cash basis I am out of pocket about $200 but my principal has been reduced by $800. The way I look at it, I have to spend $200 a month to increase my net worth by $800. I am not subsidizing your cheap rent, I am subsidizing your contribution to my net worth.
(Sorry if that sounds arrogant, I don't mean it to come off that way.)