Rental goals and possible set backs

[Jordon Mayo]

So I am currently in the Marine Corps and will be getting out in about a year from now. I will be looking to buy a home for 100k with 7k down. My concerns are, 1- not being able to produce the rental income I will need to in order to come out with $200 cash flow 2- the property sitting vacant more than 2 months. 3- I still need to learn more about upfront costs other than the down payment. And finally I am not sure what The course of action would be if a tenant destroyed a home due to being evicted. My goal is to have a 100k home with 7k down with a payment of no more than $550 mortgage and rent set at 1,500 this should cash flow nicely with taking into account, ($200) property tax ($120) insurance (?) 6% management 5% vacancy 10% repairs What expenses am i missing? I am aware that to get 100k home to rent for 1,500 is going to take some hunting but i think it is realistic. Any advice would be greatly appreciated. Thanks in advance!

[Mike H.]

One thing I would suggest is that this whole thing of a tenant "destroying" a home is not really as frequent as you would think.

I've been doing this for about 10 years now and I currently have 66 homes. I don't think I've ever had a tenant destroy a home.  Typically, the worst case is you have carpet and have to replace it all because the tenants never took off their shoes. Then paint the whole thing and maybe some trip.  Then spend 400 bucks on a dumpster to get all their trash out. Fleas. One even snuck in a cat on me that peed and I had to yank up the flooring, trim and some drywall even.

Thats probably the worst you're looking at. I don't think I've ever had a tenant do any malicious damage to a house before. One stole a fridge on the way out. Another stole a shower head on the way out.  Thats two things in 10 years and hundreds of move outs. Paint and a good cleaning are typically all you need.   But even on the bad ones, the worst tends to be the flooring and leaving a bunch of trash.

Stick to decent areas with decent schools and you'll be fine. And don't do carpet (use laminate, vinyl plank, or tile) and you would be surprised at how low your turnover costs are as you'll typically just need to paint and clean and do some minor repairs (gfi's here and there, appliance here and there).