Is my cash flow projection way off?

[Steven E.]

Hi all -- I'm trying to build out some kind of cash flow projection formula for analyzing properties. I'm looking in Grand Rapids/Holland/Muskegon/Kalamazoo MI.

For simplicity's sake, assume a $100K property renting for $1000/mo:

• $400/mo for a 25% down, 30-year mortgage with 5% interest
• $300/mo for PM/vacancy/repairs/CapEx (30%)
• $250/mo for property tax
• $50/mo for home insurance

Expenses = $1000/mo

My first thought was that property taxes looked pretty high. Non-homestead millage rates are around 50-55 in Grand Rapids, whereas in Kalamazoo/Holland/Muskegon they're around 60-66. With a tax assessment ratio of 50%, that puts property taxes between ((50000 * .05) / 12) and ((50000 * .066) / 12), or $208 and $275 respectively. Is my math off?

Cheers