Missing costs can dominate
Financing, closing costs, taxes, depreciation, repairs, vacancy and selling fees can materially change ROI. Keep assumptions consistent when comparing deals.
Example
If a property is bought for 300,000, sold for 360,000, earns 60,000 in rent and has 30,000 in expenses, simplified profit is 90,000 before financing and taxes.
Common mistakes
Do not ignore transaction costs, vacancy, repairs, property management, tax treatment or loan interest. These can change a positive-looking ROI quickly.
Limitations
This is not investment, tax or legal advice. It does not model leverage, depreciation, capital gains tax, local fees, refinancing or risk.
Last reviewed: 2026-05-17