Help Evaluating Marion County FL Property

[Clifton R.]

Hello All,

I'm looking to crowd source some help in evaluating a potential new build-to-rent purchase in Marion County, Florida. I bought several last year before the surge in prices and closed with an average 4.25% in conventional financing. I'd like to continue to invest in Florida given population increases, overall job market and rental demand.

Now that prices have dramatically increased and mortgage rates have ticked up, those easy decisions are gone. I have only about a year of experience so I'm not sure if I have to adjust my criteria or move to another market. I'm stuck in analysis paralysis mode.

My buy criteria is simply is at least $180 in monthly cash flow (taking into account vacancy and maintenance) and a debt service ratio of 1.2 or greater. I'm investing first for cash flow with appreciation being a bonus.

The property is located in Marion County, FL with a purchase price of $244,900 and expected rent of $1,645. I assumed the following:
3% appreciation (very conservative)
5% conventional loan
5% vacancy
5% maintenance
8% property management
$2,400 annual property tax
$550 annual insurance

You can view the BP calculator results for the complete analysis.

It's still cash flow positive (~$600 annual) but below my initial requirements. Looking out 10 years I think it looks like a solid investment.

I do realize that part of the decision is how the investment fits into long term goals however I'm looking for some perspective. Any feedback would be appreciated.

Thanks.