Cash Flow Question; Money set aside for vacancy, repairs, cap ex

[Account Closed]

From what I have gathered, if a potential investment doesn’t cash flow with 5% vacancy, repairs and cap ex then it should be a hard pass. We are looking at a property that MIGHT cash flow $50/month but I am also allotting 5% vacancy, 5% for repairs and 5% for cap ex which according to BP rental calculator will be roughly $700/month. Is the $8,400 that is set aside for the inevitable essentially cash flow for time being? 

Thank you in advance

[Cody Neumann]

@Kris Osborn

I would not count that as cashflow as you will have expenses in the future that you need to cover. It would really depend on your goals such as how much you are looking to get in cash flow per month per door. Depending on the condition of the property if it is in good shape I normally do 5% repairs, 3% vacancy, and 5% cap ex.