One of the best unique features about owing single family homes as investment property is the ability to receive monthly cash flow.

Properly selected properties can yield outstanding returns that are paid out in the form of income in a monthly check. Compared to traditional investments, this attribute makes cash flow real estate especially attractive.

Traditional investments, such as stocks, bonds, and certificates of deposit, do not pay their investment returns monthly. Depending on the investment instrument, cash from these investments is most often received quarterly, semi-annually, annually, or at the end of the term of the investment, which could be after several years.

Meridian’s goal is to provide first-year cash-on-cash returns in excess of 10%, and continues to be successful in doing so. In the current market environment, that is a phenomenal return as compared to traditional investments. Plus, the investment is a great hedge against inflation, as rents will rise with inflation but the cost of the mortgage remains fixed.

The tax benefits of owning investment property mean that the cash flow can be wholly or partially tax-deferred due to the ability to write off depreciation. To put this into perspective, cash flow from a 10% tax-deferred investment such as real estate is equivalent to over a 15% taxable return to an investor in the 35% tax bracket.

When the positive cash flow is added to the increase in equity as the property appreciates and the mortgage is paid down, the total internal rates of return (IRR’s) of our investment properties over 5 years often exceed 20%, net of sales expenses. But roughly half of the return is received from the monthly cash flow. Having that monthly check is especially important to retirees or others who wish to use the cash flow to help pay their monthly bills.

At Meridian Pacific Properties, we have done all of the homework up front to deliver quality investment properties that deliver monthly positive cash flow. Learn more about our investments by exploring our website, or contact us and speak to one of our knowledgeable representatives.