Is single unit ever a good option?

[Reggie Chau]

I have been looking into buying a rental unit. I have been reading and learning on these and other forums and have been playing with a spreadsheet for calculating cash on cash ROI and % profit, etc. The spreadsheet on BP forums is admittedly conservative but I am not a very optimistic person, and my past experience with renting out my SFH (sold now) has taught me to be conservative as well.

FWIW, I live near Southern NH, and Nashua NH has some good rental properties. However, when I plug in the numbers I see a 2% ROI with 25% down payment on 135K. Even if I buy the property with cash (I can't) I don't see very good returns - percentage wise.

Just for kicks, I tried buying a cheaper property in Cleveland OH with slightly lower monthly rent (Nashua is around 1100/mo, Cleveland is around 1000/mo). It still does not seem very lucrative. The only way it makes sense is if I buy a 2 unit property for, say 150,000 in Cleveland. But I am not sure how much duplex properties cost realistically - I am just trying this hypothetically.

So my question is, does it ever make sense to buy a 100K to 150K property to rent out at 1100 to 1400 per month as a single unit? The only way I see that working out is if you get lucky and have no repair costs and long term tenants with low turnover. Thoughts?