Help with understanding Cashflow analysis

[Armando Montrond]

Rookie question here, Ok I know cashflow is pretty tough to come buy now a days, but I have been putting some deals through the rental property analyzer (single families) Here is what I am putting in for parameters. These for the most part are not real numbers I am just trying to find what is the minimum i need to get cashflow positive 

6% rate with 20% down, 

8% vacancy,

5% capex 

5% maintenance. 

400 for Gas,electric,sewer,trash 

Im doing no fee for property management right now as I will be managing this myself. 

I am looking to do MTR and inflating the rent to 2400 a month

I am finding that in order for anything to cashflow positive with these numbers, I would need to find a property with a purchase price of around 150K or less. I know SF will not cash flow as much as MF, but it cant be that in order for anything to cashflow I need an extremely cheap property with an absurdly high rental rate. What am i doing wrong here or are the numbers just the numbers and if I want cash flow i need to find something cheaper than 150k or do a multi family?

[Clayton Silva]

For an investment loan, I would typically have the following based on what you put:

Rate: 7.5% (conventional) or 8.5% (DSCR)

Down: 15%-25% depending on Single Family vs Multi Family, or conventional vs DSCR

Vacany: 5% (depending on market). If you have more than 5% vacancy in your market right now, you likely need a new market or you are charging too much in rent

CAPEX: 10-20% (I lump repairs and maintenance into CAPEX and some spreadsheet warrior will probably yell at me in all caps for it) but this number is dependent on the age/condition of the property and I keep a CAPEX max balance. Example, once my CAPEX account gets to $10,000/property (hypothetically) then I would stop contributing to CAPEX and that money would be extra cashflow.

Utilities/trash: $0 pass it to the tenants

MGMT: 8-10% (I use professional management personally, but I know you said you would self manage.) I would still try to underwrite it as if you were going to pay property management, and maybe just pay yourself the management fee, but it gives you the ability to hand it to a manager down the road.

This may not make your analysis make sense which means it may be time to move to a different market or start getting really aggressive with your offers.  Hope this helps a bit though!