An investor turned a century-old house into a rental that cash flows $2,500 a month. He shares how he financed it with 5% down.

Seattle-based real estate investor Peter Keane-Rivera turned a century-old house into a rental property that generates about $2,500 in monthly cash flow. Keane-Rivera, a full-time engineer, bought a roughly 100-year-old, 3,900-square-foot house in Kent, Washington, for $630,000 in 2024. He then converted the five-bedroom home into a nine-bedroom rental.

Keane-Rivera put down 5% of the purchase price, which amounted to about $32,000. He financed the remaining $598,000 through a conventional loan with an initial interest rate of 7.75%. After paying a 1% premium for a $10,000 closing credit, he refinanced after 12 months, securing a new rate of 5.375%.

The renovation costs amounted to roughly $150,000, which Keane-Rivera covered using a $50,000 loan from his 401(k). The property now has nine bedrooms, three additional bedrooms and bathrooms added to the unfinished basement, a converted dining room, and other improvements. The house now appraises for $875,000.

Prior to refinancing, the property's cash flow was inconsistent, with some months resulting in losses or barely breaking even. However, after refinancing and the renovations, the property generates about $8,876 in monthly rent. After accounting for expenses such as mortgage payments, utilities, property taxes, and insurance, Keane-Rivera estimates that the property yields around $2,500 in monthly cash flow.