Why is the expenses so high?

[Joshua Ross]

Why do you account for expenses so high. Like with the 50% rule. 50% of rent will be spent on expenses. For instance, if I know every thing has at least 3 years left on its life and I handle property management and everything breaks at year three Ill be fine. At least the way it looks. What am I missing?

Property: $100,000

Rent: $1,000/Month

Property Tax: $2,500

Mortgage: $500/Month

Profit: $300/Month

Appreciation in my area is pretty high but lets say 3% appreciation is $9,000

Ill have three years of equity of about $6,000.

At year three I'll have $25,500 ($10,500 Cash, $15,000 Equity) in that property. Even if the foundation was what needed repaired at $10,000 on year three Ill still have $15,500. The foundation repair is 25% of BiggerPockets CapEx estimations.

Even if I didn't have a tenant for two month(16%) out of the year. I would only lose $6,000 leaving me with $9,500.

Worst case scenario. 100% of BP CapEx estimations come up at year three. The property is values at $110,000. I owe $94,000. I subtract BP CapEx estimation of $40,000 selling at $70,000. leaving me to payoff $24,000.

$24,000-$10,500= -$13,200 loss. And being one of the unluckiest person to have everything break at once.

Does any of this make sense? or am I just way out in left field? Liquid cash is not a problem.

Asking for a friend.