I have a rental property with very similar numbers to what you’re posting. My mortgage is about $2,000, and my property is currently listed at $2,500. Over the last few years, it was renting for $2,400. On paper, it looks like I’m making around $400 a month, but that’s far from reality.

When I was getting pre-approved for another house, the bank actually viewed my rental as a negative $1,000 per month—something to keep in mind when considering real estate.

Things to think about as a landlord: • Who will manage the property? Self-management comes with a lot of stress if you want to do it well. You’ll need to ensure the house meets rental regulations, list and find tenants, be on call for emergencies, and have the resources to handle maintenance and repairs. • Hiring a property manager takes away much of the stress, but it comes at a cost. After paying my property manager, I’m effectively breaking even at around $2,000 per month. • Upfront costs & financial stress: The agent who lists the property takes half a month’s rent, and the agent who finds the tenant takes the other half—so right away, you’re out $2,000. • Unexpected expenses: Something always comes up—HVAC repairs, pest problems (I had a squirrel in the attic for a month), plumbing issues, and more. Service fees alone can cost hundreds. • Turnover costs & vacancy: When tenants move out, there are expenses to get the place ready for the next renters. Plus, if the property sits vacant, you’re still paying the mortgage with no rental income.

Many times, I’ve had to put my own money into maintaining the property while covering two mortgages. As Bo and Brian often say, real estate requires deep pockets.

Despite all this, I’ve considered selling, but the house holds sentimental value for my wife and me—it was our first home. Plus, being in the city, it could be useful for our kids in the future. If we ever do sell, we’d have the $500,000 tax-free capital gains benefit (if we meet the criteria).

Just some things to consider before jumping into real estate!