First Deal, opinions?

[Marcellus Kwong]

Hi all, I'm looking to make my first purchase out of state in Texas.

This is a 4 bedroom 2 bathroom SFH that I will try to get for $100,000. My interest rate is 4.625% fixed for 30 years, and I will be putting 20% down and getting a loan of $80,000.

My property management team in Texas said it will rent out for between $1150-1195 a month.

Being that it is out of state, I will be charged a 8% management fee.

Here are the expenses that I've broken down/set aside per month:

• Management fee: $92
• New Lease fee (when they have to find/renew a tenant): $15
• Maintenance/repairs: $58 (I used 5%, is that good?)
• Vacancy/rent loss: $58 (also used 5%)
• Principal/interest: $414
• Property Tax: $189
• Insurance: $83 

Total expenses is about $908, and with a rent of $1150, the net cash flow is $242 per month, or $2901 per year, which yields a 14.51% cash on cash return.

With the 50% rule, the numbers only yield $161 a month, or $1932 a year, which is only a 9.66% cash on cash return.

What are your thoughts? Thank you!