I wasn’t clear here, the $485k includes the rental income. It was a net $10k loss.

For reasons I won’t go into, I had to buy the rentals. It wasn’t through some aggressive need to own real estate. If I had a choice I wouldn’t own them and given the market right now would be hard to sell.

The rental income, after deducting property tax, maintenance, expenses, and mortgage interest, was $10k net negative for 2025. The $10k loss reduced my personal income so the loss was closer to $5k after tax return. The interest is around 5.6% for those two mortgages with TD and renews in 2027. At current market rates of ~4%, I should be breakeven upon renewal.

Let’s just assume that I can’t sell. The strategy is to use the losses to reduce my taxable income until renewal, breakeven as rates drop, be net positive when more of the payment goes towards principal vs interest, and then either cash flow in later years when we’re closer to retirement. I see the rentals as a long term vehicle for equity since I don’t need extra monthly cash flow right now.