My first investment property questions

[Tim S]

I'm getting serious about purchasing my first investment property. I could use some advice/recommendations to help decide between 2 potential properties. Both are REO properties and I estimate both will need an additional $5k rehab.

Property #1 Town House built in 2006: $85k with 25% down payment. Loan value ~$64k. Estimated rent of $1200 with estimated positive monthly cash flow of +$300 (plus $262 towards equity each month).

Property #2 Condo built in 1987: $42k cash. Estimated rent of $800 with estimated positive monthly cash flow of +$450.

I appreciate your feedback.