Roger's woze

My wife and I have been house hunting recently.

We ran into a little cute place, split in 4.  2bed+2bed+1bed+1bed

rents are $600+$600+$500+$500

So we did a little calculations to see when we could reach our retirement goal, $1000/month of “free” money.

Here they are.
“K we’ve calculated it out.  This is mostly as a joke but thought I’d
send it to you–how fast one could theoretically retire

We buy the little 4 plex for 270K [asking 280, we'll offer 265, less 3.5% down, which we have, plus closing, which we'll have the seller pay].

Monthly payments are 1533/month*

First year in it (we’ll live in it for one year):  We’ll pay nothing toward it except rent for our
space, and just save up for the down on our next place.  Total rent -> 2200*12 -> 26400 (assume 100% occupancy, no repairs necessary), put it entirely toward the mortgage.

Of the total payments toward the mortgage 14759.22 will be interest
for the first year [1], so total theoretical payment against the
principal:
26400-(14759.22) -> 11000 paid off

Second year [we are not in it...assume for the whole year--we'll move to a dinky duplex somewhere else]
the occupants pay 26400
we’ll also pay another 15000 out of pocket (since we don’t have to save for our next place now)
total interest: 13500 we’ll say
26400 + 15000 – 13500 -> 28000 paid off

third year:
26400 + 15000 – 12500 -> 29000 paid off

fourth year:
30000 + 20000 [increased rents, salary] – 11000 -> 39K paid off [now
you know this is fictional, though perhaps I could get a raise and
increase rents by $100 each]

fifth year: 30K + 20K – 10K -> 40K paid off

half of sixth year:
15K + 10K – 9K -> 16K

Total paid off in 5.5 years: 16+39+40+29+28+11 -> 163K (out of 270K)

refinance at that point for the remainder of the loan [107K] at 5.5%
which leaves us with monthly remaining mortgage: ~600$

total monthly income from it: ~ 2200
-> total incoming cash flow from it: ~1600/month

We’d still be living in half of another duplex still, with 50% of the mortgage payments being about 600$ probably
So net monthly income for ourselves [into pocket] would be $1000, our retirement goal.

Yes! We can retire early! 5.5 years away!

There you go–with wise investing you can probably retire in 10 to 15 years–just buy multi units, live in them, then move on and keep renting them.

Why don’t more people do this?  What is the drawbacks?

Thanks!

* oops forgot about FHA mortgage insurance + home owners insurance–that’s another $150/month I suppose.