Am I Analyzing Properties Correctly?

[Riley Harris]

Hey, I could use some pointers on whether or not I am doing analyzing the cash flow on properties correctly (or whether or not I'm even on the right track).

I'll provide an example property: 

3 bed 2.5 bath townhome listed at $265,000

I project that the rent should at least be $2050 (when renting rooms individually).

If I offer a maximum of $250,000, then 250,000 x 0.08 (targeting the 0.8% rule) = 2000 ... so this meets that rule of thumb, now I can continue evaluating.

Calculating NOI:

Scheduled Rent.....2050

Vacancy (5%)..........(102.5)

HOA.........................(174) [Covers lawn, water, sewer]

Repairs (5%)............(102.5)

Taxes........................(170)

Home Insurance.....(93)

Electric.....................(150)

Prop Mgmt (11%)...(225.5)

CapEx (10%)............(205)

-------------------------------------

NOI: 2050 - 1222.5 = 827.5 

Income - Mortgage = 827.5 - 1264 = -436.5 Cash Flow Per Month

Questions:

- Am I analyzing cash flow accurately? 

- Is there anything I'm not accounting for that I should or anything that looks off (perhaps too high, too low)?

Currently it seems near impossible to find something that will work in the current market (where I live at least). Any advice regarding this? Do you view it okay to start out with negative cash flow and lean on appreciating rents and loan paydown?

Thanks!