Today, I’m pulling back the curtain to give you a real, unfiltered breakdown of what it looks like to own and operate multifamily real estate in the Detroit, Michigan area. My wife and I own a 42-unit apartment building in Birmingham, MI, a highly desirable suburb just outside Detroit. And unlike the “gurus” who claim cash flow is just rent minus mortgage, I’m showing you the real numbers straight from my October Profit and Loss (P&L) statement.
This was a strong month for us, and I’m walking you through exactly how we generated $17,563 in true cash flow—without outside investors, no syndication, and no fluff.
We had a great month in October, and I’m going to break down exactly how much cash flow we made—without any outside investors or syndication.
Step 1: Gross Income – $64,128
For October, our 42-unit property brought in $64,128 in gross income, which is excellent performance for a Detroit-area multifamily building.
While many people focus only on “rent,” the real money in this business—especially in competitive markets like Metro Detroit—comes from smart operations, management efficiency, and fee structures. That’s where we excel.
Here’s what boosted our income beyond rent:
• Ancillary Income
Fees from 7-day notices, application fees, and admin fees. These are small individually, but powerful when scaled across a building.
• Pet Fees
One of my favorite income streams. Pets = fees. Plain and simple.
• Renters Insurance Fees
We require renters insurance. If tenants don’t carry it, we bill them.
• RUBS (Ratio Utility Billing System)
This is huge. We bill back for utilities that tenants use—because I’m not the one taking the showers or using the heat. This alone can transform the economics of a building.
• Leasing “Dead Space” — A Detroit Value-Add Strategy
This is where creative operators win. We identified unused office space in the building that the previous owner ignored. We renovated it and leased it out.
In other deals, I’ve leased barns, parking lots, storage rooms—anything that sits empty is a monetization opportunity. This is one of the best strategies in value-add investing, especially in Michigan, where older buildings often have unused square footage.
Total Gross Income for October: $64,128
Step 2: Total Expenses – $46,565
Running a multifamily business in Michigan means tracking every expense. Here’s what we spent in October.
The Largest Expense: Mortgage – $28,000
This is an interest-only loan for 18 months, which we intentionally structured because this was a value-add BRRRR deal.
Interest-only = more cash flow up front
But remember: no principal is being paid down.
This strategy is smart only when used intentionally to create value fast—exterior upgrades, curb appeal, renovations, etc.
Other Major Expenses
Here is a breakdown of the other major and random expenses that hit our cash flow in October:
| Expense Item | October Cost |
|---|---|
| Mortgage | $28,000 |
| Property Taxes | $9,500 |
| Manager Salary | $2,900 |
| Maintenance Tech Contribution | $2,400 |
| Insurance (Commercial Bundle) | $1,800 |
| Utilities | $800 |
| Unit Turn | $450 |
| Landscaping | $440 |
| Advertising | $400 |
| Subscriptions | $225 |
| Supplies | $189 |
| City Inspection | $75 |
Total Expenses for October: $46,565.
Key Notes About These Detroit/Michigan Expenses
1. Property Taxes in Michigan
Because this property last sold in 2008, our tax basis is high.
Michigan summer taxes are brutal compared to winter. If you aren’t ready for it, high Detroit-area property taxes will wipe out your cash flow.
2. Paying Salaries to Build a Real Business
We pay for a manager and contribute to a maintenance tech’s salary.
Could I save money by self-managing? Sure.
But I’m building a real multifamily business, where OPT (Other People’s Time) allows me to operate at scale.
3. Commercial Insurance Bundle
Bundling multiple properties into one commercial policy saves significant money across the portfolio.
4. Utilities
Our utility costs stay low because many of them are:
• in tenant names, or
• billed back via RUBS
Utility billing cycles can vary wildly, so this number isn’t always consistent.
Step 3: The Cash Flow Result
Gross Income: $64,128
Minus Total Expenses: –$46,565
October Cash Flow: ⭐ $17,563 ⭐
Annualized, this amounts to approximately $210,756 in cash flow.
The Bottom Line: What We Do With the Cash Flow
Even though this was a great month at 99% occupancy, cash flow is never something you just “spend.”
I’m not touching that $17,563.
Why?
Because this is a BRRRR property, and we’re still in the renovation and improvement phase. Future projects include exterior paint, landscaping, and continued upgrades to force further appreciation.
Smart operators reinvest cash flow into future value—especially in Michigan’s competitive multifamily markets like Detroit, Birmingham, Royal Oak, Troy, and Southfield.
Final Thoughts: Detroit Multifamily Real Estate Is the Greatest Vehicle
Multifamily real estate is the greatest wealth-building vehicle I’ve ever found. When done right—with good operations, strong management, and creative value-add thinking—the cash flow is powerful and scalable.
This October breakdown is a real example of what’s possible when you run your building like a business.
If you want to learn more about the ancillary income streams, fees, and the overall game of small multifamily investing, check out my book, “The Small Multifamily BRRRR Method.” or apply for business coaching. A small deal—even 5 to 25 units—can change your life.
