Questions about Analyizing Potential Rentals

[Brian Dudash]

Hi All! I apologize for the long post in advance :)

Anyways, it's been awhile since I've visited BP but over the past couple of years I've been looking into buying rental properties for passive income (but too "scared" to pull the trigger). In the last couple of weeks, I've been seriously looking into a few different potential rental properties in the Cleveland area (where I'm originally from).

Currently I have a local realtor who I'm working with, plus I've started the process of getting pre-approved from a couple of different lenders. Now the real questions:

When I'm trying to analyze a deal, which includes things the most common expenses (that I read about, at least), the net profit ranges around $120-$150 (max) per month.

The more I read/research, some places say the $150 per month is a good number to shoot for and others say $200+ but I don't see how people get to the ~200 range, unless I'm doing something completely wrong....

Keep in mind that this would be my very first rental and I've been looking mainly at "rent ready" properties that would need little to no work when purchased - thus the price is probably on the 'higher' side than most people would like on BP. The scenario below is an example of what I've been looking at (all estimated numbers):

Asking Price = $108,000 (located in Lake County area, in Ohio)

3bd, 2ba, 1324sqft, built in 1957

Rent = $1,200/month

Rehab = $0

Mortgage @ 30yrs = $4,860/yr

Insurance + Property tax = $3,000/yr

Repair = $1,440/yr

Vacancy = $1,200/yr

PM = $1,440/yr

Est CapEx = $720/yr

Without including possible utilities I would have to cover (like water, gas, and garbage), plus lawn/snow care, this only cash flows around $145/month - if my calculations were correct. The only way I can make these type of properties over 150 but possibly 200+ is without any PM. While this may be doable in the short term with a small amount of rentals, I want to include PM in all deals regardless if I use one or not - just in case. Am I doing something "wrong" here??

Is the only way to make close to $200+ (w/ including PM), is by buying very cheap, reno, then renting? I'm pretty confused right now...

Lastly, just some random questions:

1. Do most landlords of SFH rentals pay for lawn/snow care or do you have the tenants "cover" this?

2. How common is it for the tenant to pay for all utilities like I mentioned above? I'm currently a renter and I have to pay for everything but maybe I'm just getting screwed over lol

Thanks again!