Cash Flow and Property Taxes
Hello BP!
I'm running the numbers on my first potential investment and am at an impasse regarding property taxes. With current rental rates and property taxes it seems impossible for me to cash flow unless I have a $100 mortgage. Max monthly rent I can charge for a 3/2 in this area is $1250. Property taxes are $500/month, which eats up almost half the income right off the bat. If I buy a 4/3 and charge $1600 I'm cash flowing $100/month. Even though this cash flows it seems like a $5000-6000 property tax hit every year just isn't worth it.
Have high taxes made you guys look elsewhere or is there a way for me to approach the numbers differently to make it work? Should the property tax write-off affect how I look at the numbers or is it just time to find a cheaper property? Is there a rule like the 1% rule, 50% rule that investors use for property taxes? I've attached the numbers for one potential property using BP's rental property tool. Thanks!!