CalculateRealEstateROI

Investing

How much cash do I need to start investing in real estate?

For a conventional rental, plan on 20–25% down plus 2–4% closing costs and 6 months PITI in reserves — roughly $50–70k on a $200k property.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

For a conventional rental, plan on 20–25% down plus 2–4% closing costs and 6 months PITI in reserves — roughly $50–70k on a $200k property.

Expanded explanation

House hacking with FHA cuts down payment to 3.5%. BRRRR strategies often recycle capital out within 6–12 months. Partnerships and syndications let LPs start at $25–100k. The biggest mistake is stretching the down payment to the point of zero reserves — first vacancy or capex event becomes a financial crisis.

Examples

  • $200k SFR: $40k down + $6k closing + $9k reserves = $55k.
  • FHA duplex house hack: $10k down + $6k closing on $300k = $16k all-in.

More Investing questions