Podcast Summary: BiggerPockets Real Estate Podcast

Episode: Are $100K Rental Properties Ever Worth It?
Date: January 28, 2026
Host: Dave Meyer (A)
Guest: Henry Washington (B)

Episode Overview

This episode tackles the question: Are sub-$100K rental properties actually worth investing in, or are they financial traps in disguise? Host Dave Meyer is joined by seasoned investor Henry Washington for a debate filled with candid stories, actionable advice, and a healthy dose of Henry’s “soapbox” rants. The pair also address the ethics of flipping from the MLS, optimizing down payments in today’s market, and frustrations with hard money lenders.

Key Discussion Points & Insights

1. Should You Buy a Sub-$100K Rental Property?

Timestamps: 00:00–07:35

• Context & Risks:
  • Cheaper properties can be tempting, but “anything that's cheap is usually cheap for a reason.” (Dave, 00:14)
  • The upfront price is not the whole story—hidden costs (maintenance, repairs, age, bad foundations) can wipe out perceived savings.
• “It depends” — Market Matters:
  • It’s relative to the local market; in some cities (e.g., Detroit, Cleveland, Buffalo), <$100K properties can be solid, while in others, they don’t exist (e.g., NYC, Washington).
  • “Parking spots cost more than that here!” (Dave, 04:49)
• Condition trumps Price:
  • “It's not about the price... It's more about what's the age of the home and how much maintenance has been done on the big ticket items.” (Henry, 03:07)
• Scale and Return:
  • Even if cash-on-cash return is high, the absolute cash flow (e.g., $75–$100/month) may not be worth the effort and hassle for a single unit.
  • Dave prefers targeting $100K/unit in Midwest multifamily properties for better scale and efficiency.
• Common Mistakes:
  • Don’t buy just because something is cheap. “They are cheap for a reason. And unless you have a way to fix that, you are just going to be in for a lot of headache and a lot of stress.” (Dave, 07:19)
• Summary Advice:
  • Always underwrite for future costs.
  • Buy based on goals, property condition, real projected returns—not an arbitrary price point.

Notable Quote

“Stop picking markets because you think it's a cheap market. Pick a market based on if you can hit your financial goals.” — Henry (07:35)

2. The Morality & Impact of Flipping Properties from the MLS

Timestamps: 09:32–17:35

• The Moral Debate:
  • Listener question: Is buying distressed properties from the MLS and flipping them for profit hurting affordability and first-time buyers?
• Henry's Take:
  • Two sides:
    • Some investors cut corners (“lipstick on a pig”), others add real value.
    • A healthy market needs investors to bring new/renovated stock.
  • He usually targets properties that have sat unsold for well over average days-on-market; these are not being “stolen” from eager homebuyers.
  • Homebuyers often could make low offers, but don't.
  • Advocates revitalization, not gentrification: “…sell it back to the community at a price point that they can afford.” (Henry, 15:27)
• Dave's Perspective:
  • The MLS is an open market; sellers choose the best offer. Flippers provide a needed service when homes require work regular buyers can't/won't tackle.
  • It's a free market—if there's no demand for the flipped price, no one buys it.

Notable Quote

“If the investor is going to take on that risk and put into the work, they are entitled to a profit—I personally believe that.” — Dave (16:44)

3. Is a Bigger Down Payment Worth It for Cash Flow?

Timestamps: 17:35–21:22

• Listener Scenario:
  • Abdul from New Jersey wonders if it makes sense to put 40% down and self-manage for cash flow in today’s high-rate market.
• Dave’s Analysis:
  • Larger down payments reduce debt, making cash flow stronger in absolute terms.
  • Good strategy if your primary goal is steady income, not maximum leveraged returns.
  • Dave’s personal plan: “In 10, 15 years, I hope to have no debt... I just want cash flow... and just to chill and not worry about things.” (18:41)
• Henry’s “Debt Snowball”:
  • Actively ranks his portfolio assets by keep/sell/dispose status, sells some to pay off others, aiming to own properties free and clear for long-term wealth.
• Consider 15-Year Notes:
  • Dave suggests bigger down payment plus 15-year loans to minimize total interest, even if cash flow isn't immediately maximized.

Notable Quote

“Paying down debt is just accelerating you getting to where you want to be in the future anyway, which is having a paid off asset 100%.” — Henry (19:58)

4. Hard Money Lenders: The Necessary Evil?

Timestamps: 25:18–31:00

• Listener Frustration:
  • Roberto from Houston asks for pet peeves and improvements in the hard money lending process.
• Henry's Epic Rant:
  • “Investors, hear me loud and clear. You are the prize. You are the prize. Lenders do not have a business if investors don't have deals... Stop treating them like they are the king. You are the king.” (25:32, 26:46)
  • Hard money lenders often act as if investors owe them something.
  • Too many hoops (photos, forms, slow draws), especially for experienced operators.
  • Suggests a tiered system:
    • Newbies get higher scrutiny.
    • Proven investors get faster service, less red tape.
  • Lenders need to recognize they're in a service business, not the kingmakers.
  • Many are rigid because they don’t know how to properly underwrite—so they pile on controls to mitigate their own risk.

Notable Quote

“You are the thing that they need... There are hundreds and thousands of lenders. If the one you're talking to doesn't want to work with you... go find another one.” — Henry (27:02)

Memorable Moments

• “Soapbox Henry” comes out swinging on hard money lenders—arguably the most spirited and entertaining segment (25:18–31:00).
• Dave’s blunt summary on chasing cheap deals: “They are cheap for a reason. And unless you have a way to fix that, ...you're just going to be in for a lot of headache and a lot of stress.” (07:19)
• Clear, actionable frameworks for evaluating properties—don’t use arbitrary cost lines, but focus on your own goals and sound underwriting.

Key Takeaways for Listeners

• Don’t be seduced by low price tags. Evaluate any property, cheap or expensive, by its fundamentals: location, condition, future costs, and how it fits your financial goals.
• In flipping, recognize that the MLS is an open marketplace. Investors can add value and serve the community, but should focus on revitalization, not just big profit.
• Flexible financing strategies (higher down payments, shorter loans, debt snowballing) can create immense long-term security—even if you aren’t maximizing quick returns.
• When dealing with hard money lenders, remember: you drive the business. Choose partners who treat you like the customer and adapt as you grow.
• Always underwrite conservatively, focusing on the real, long-term math of each deal.

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