Relative ranking of my first rental "deal" vs. the rest of the US (monthly cash flow)

[Craig Daniels]

Hi - I am curious what the forums will make of my first deal and whether it is relatively good or relatively marginal. I am in the Palm Bay, FL area and bought an SFR 3/2 for 220k. 30% down, 6.375% rate, and after all expenses, with a property management company, it should cash flow roughly 175/month. I did put in about 15k of work into the place to get it from the 1980's look to something more modern as the rentals I am competing against are newer builds, but at higher price points. This is the investment thesis in my area, it is becoming a bit saturated, but if you can rent just below the new build/corporates, and maybe accept tenants that are a bit outside of the corporate approved model, you can keep your place rented. I am geographically close to this property, so I am pondering not using property management to get another 175/month out of it.

I continue to look in the Brevard area of Florida - As far as north as Titusville/Cocoa and as far south as Sebastien.  It seems that if you can find a good deal on the purchase price, are willing to do cosmetic updates (floors, painting, maybe a kitchen) you can get that 100-200/month cash flow.  

Is this a good cash flow relatively speaking?  I have not started to look outside of the area to out of state rental opportunities, but I am wondering if there are remote markets with a higher return than this that I should be looking into.   

[Jonathan Greene]

I don't think $175/month is good in Florida (or anywhere) for 30 percent down, but it also depends on what the rest of the block and area is like and if there is appreciation scale. Your thesis is basically rent low and accept less desirable tenants so I don't think that is the best thesis to base an investment off. If you have any cap ex left in Palm Bay (like an HVAC major repair or roof) you will lose cash flow for years.