Ask Litra: What Is a Healthy Cash Reserve Per Property?

The podcast, hosted by Litra Simms, discusses the significance of maintaining a healthy cash reserve per property in the real estate domain. Litra suggests holding three to six months' worth of total property expenses—such as mortgage instalments, taxes, insurance, utilities, and maintenance costs—as a financial safety net. The amount held may need to be adjusted based on the property's age and the market's volatility. Litra also emphasizes assessing reserve strength in terms of months rather than dollar value to better gauge financial leverage during unexpected challenges. The benefits of strong reserves, as discussed, include avoiding forced property sales, handling sudden repair costs, and combating slow rent payment scenarios for a robust financial outcome.