Minimum Rent

[Michael Herr]

I have a property identified for potential purchase. 

1920 2bed/1bath new roof,  pipes,  water heater. 

Nice wood floors and woodwork throughout. 

Comps support 24-27valuation

Asking 16k

Rented at $550

Taxes $780/yr

Taxes $400/yr(est)

Management $75/month(prop. manager's min.)

Distressed sale,  needs "no"  work,  tenant in place. 

Planning on no money down 15yr loan at 6%

This deal passes the standard rules of thumb: 2%, 50%, 70% 

It fits my strategy of not wanting a bunch of debt long-term  (I could pay this off pretty quick)

I have some other(3-4bedroom) houses nearby that stay occupied.  It's not he best neighborhood,  bit it's certainly no war zone. (there is a section of town that houses go for 5k)

What are your thoughts on the deal? I like the house,  but I think sometimes with fixed costs it's hard to make money with lower rents. 

I do long-term buy and holds.